. this is "nightly busine report" with bill griffeth and sue herera. corporate shakeup. boeing's ceo is out as the fallout from its grounded737 max continues. what ins all m for the company and for boeing investors. portfolio makeup. with stocks at record levels, why ketonight's m monitor thinks defensive and income are very impor for some stocks that she thinks you should aow >> industry wakeup? business is doi to fight off competition from mobile gaming and streaminges servic all that and much more tonight on "nightly business report" for this monday, december 23rd. and we do bid you a good

evening, everybody. sue is off tonight. stocks again close at record levels. we'll get to that shortly. first, another shoe hashe dropp inongoing crisis involving boeing's grounded 737 max, and this te it fel in the company's c suite. ceo dennis muilenburgs out immediately. chan david calhoun will take over next month and investors reacted positively to that news sending shas higher 3%. phil lebeau has been following this. why now? >> reporter: bill, i thiwo there were things that had happened within the last month that the board of directors ounally said, . we have to make a change. the first one being thatbu denn muil was called to washington, d.c., and he was essentiallyressed down by the head of the faa. theead of the faa said you don't make demands. we call the shots as to when this plane is safe anddy r to return to the air. that was a very public meeting. maybe the meeelng i wasn't

public but it was a dressing down. ceos rarely he that happen. the second thing happened four days later when dennis muilenburg said we are going to shut down the 737 max line at least for a couple of months, temporarily is the language that they used. th'sunprecedented. for a company of this size with this history tost for the f time ever voluntarily shut down a production line. that was enough for the board. they finally said, time for a change. >>oes that speed up the return .f the 737 max? >> reporter: i think what it does do is improves boeing's relat tnship withhe faa at a minimum. already dave calhoun,f one his first acts as the incoming ceo was to call steve dickson this morning, he said we welcome rigorous oversight. we want to be regulated. that's the beginning of changing a problem at boeing for some een time and in particular during this entire 737 max crisis.

>> we should point out david industry.s a veteran in the >> reporter: yes. >> he's worked in varus other companies i that industry. what will be his agenda do you think? >> reporter: three things. one, rebuilding the relationship with the faa. it's completely broken. yoe have to h that rebuilt. second, you r we're going to do a reworking. we're sngting down, d a leadership thing. where are we, what can we realisticay expect, let's mov f forwarm here. finally, rebuilding the relationships with the airlines those are damaged. i talked to one executive at an aiine today, bill,e said dave calhoun and our ceo h a long conversation. our ceo had a look on his face like this iswelcome. n it going to change overnight but this is the beginningf improving that relationship. >> on what was supposed to be ar vacation day phil lebeau, but he came in o a big news day. appreciate it.

merry christmas. >> you've got it. merry christmas. > what is this change at boeing going to mean for the stock. joining us tonig is david deitz, president of point view o is a shareholder in boeing. what do you make of todey's lopments? >> i think it's a positive. as phil was mentioning, the relationship with the regulator, the faa had completely fallen apart. that is a secretary, you have to inject more transparency in recertifying the 737 maxes. this is well on the way. timely, new blood to defuse tensions will be critical here. i think it's a positive. >> do you want to s change in leadership? so other executives have already left the company as well but as a shareholder, you welcome david calhoun but he's only person. >> absolutely. this is a shortmove. mr. calhoun is 62 years old. he's not going to be there fory tens. he's been with the board for close to a decade so it's not a

complete rechange and he's not an engineer. boeing needs to listen to their engineers a little bit more. it's not a perfect choice. the fact that the crisis with theation, it didn't have a chance to do a six month search around thein stry. i think this is the best they can do and a positive. >> all things considere for what a disastrous year pr wise and otherwise, theto is only down 11% to this point not counting today's r comebackly of sorts. what did you make of that? >> i think that underscores why we're bullish.ba cally the aircraft business is growing 5% per year. everyone around the world wants to fly. it's the quickest way to move around. there are two companies that are in the business. you have airbus, you've got boeing. so there really aren't a lot of options. you still see theba log for e 737 maxes staying pretty constant here. i think ove the long haul given how much experience you need to get certification, you know, based on how much engineering and capital you need to make an

airplane, boeing's not going anywre. i think over the long haul ultimately it gets past that that's why the's not bigger selloff. >> having said that, you're not adding to position you're just hanging in there. >> i don't s a real callous. i would not urge peosee to . you haven above average dividend. you have a company that's one of the standouts. this is america's largest employer and exporter. this is really the king of the hill. would hang in there for the long haul. if there's another big pull back for whatever reason, yeah, you can buy into it. >> the company is not out of the woods yet. very t get t plane back in the air ando that's not going t be all that easy, i would think. >> i think that's right. it will get recertified. i thips it h things now that you have a better relationship with your regulator, you're going to get your calls returned more quickly. there's always gray areas in this certification.

i think you're going to get a little bit more of the benef of the doubt than you would under mr. mule lenberg. >> thank you for coming in tonight, david. >> thank you, bill. dow got part of its lift thanks to the gain in the shares of boeing. you couple thah w news that china said starting january 1st it's going to lower import tariffs on more than 800 products and stocks were set. the dow up ather points. nasdaq climbed by 20 and the s&p up by 289 bob pisani has more on the day on wall street. >> reporter: big volume last week and the s&p moving at a narrow trading range. still, the markets closed theor day at r highs with the dow rising 96 points. shares of boeing led theay jumping 3% after the company ousted ceo dennis muilenburg. boeing has been struggling with the 737 max jet crisis. energy stocks had a big day.

apache corp was up 7% after they with total.o a joint venture otherxploration stocks like devon and hess were up as well. many were up as oil has climbed over $60. forss "nightly busieport" i'm bob pisani at the new york stock exchangere another of business to look at, the emerging markets which have bee on a tear as trade concerns have come down. much of the focus has been o the unrest in hong kong, there are new risks for investhrs in area in the new year. namely, the sharp rise in protests and public shback in places like india, chile,a argentnd egypt. sim ma modi has more. >> reporter: a number of strategists areetting on year.ing markets in the new perts say there is a new risk on the horizon, social unrest.

in the past few monthsrotests have arisen in different parts ofhe world. income inequality, concerns of corruption are among the issues of fling these areas. in india the protests have escalated in response to a controversial citizenship law passed by the government that has drawn criticism fro many indians. th social unrest has led them to downgrade their vie on india. kbroe growing political pressures facing norinda modi. political risks in hong kong face them. hong kong's economy has fallen into aecession as consumer spending and retail sales have plunged. strategists say if protests in

different countries escalate, the economic risks will likely rise. >> let's turn to jack avlon as we head to the end of the year. en's at cre capital. good to see you again. thank you for joining us tonight. >> flies to seeyou. >> what a stellar december this has been for t markets capping off what h been a pretty rong year again. what do you make of all of this right now? >> it's a opback of lower interest rates essentially. what we realized was that interest rates were a key driver of not only themy ecout certainly the stock market given the level of debt that has really permeated the corporate balance sheet. the fed learned their lesson very quickly. reverse course. three rate cut and 38, 30% move. >> but we still haven't had thgh one o those proverbial 20% pullbacks that everybody feels is necessary to clean out

some o dead wood in the market before it resets and goes higher again. we keep going higher and higher. >> that's it. you have with the low interest rates and a friendly environment, you hav companies, you know, like sears tha probably should have been out of business five or six years ago at least still, you know, withh more 400 stores. you know, i think there is some catharsis in a washout. we haven't seen it yet. my i sense is will be precitated by higher interest rates. i'm not sure when that will occur, but given how leveraged we are to debt, so to speak, any higher interes rates will push thingslower. i don't see that around the corner but if we get some inflation, if we get stronger growth than wexpect, that could be a risk to the stock market >> once again, technology was a big leader for the markets this year. concentrated in som of those big fang stocksnd a few others

as is that where you see growth for next year? where do you see opportunity in 2020? >>. yeah, i see -- yeah, i don't see a repeat of% growth. keep in mind that, you know, earnings -- the earning backdrop was only up about 3% this year so clearly it was all peexpansion, valuaon extension. next year analysts are expting 6% growth in earnings if we get no valuation expansion then we should get around a mid ingle digit return next year all things being equal. an election year is generally a good one. policy makers don't want the wh to fall off the apple cart going into re-election so they're going to try to stay pretty cloto, you know, center lane in overseeing markets, but given what we've been, i don't expt anythingou in thee digit range for 2020. >> u.s.su v international.

you know, we've talked about the slow growth overseas, but the are signs that maybe that's bottoming out right now. is that where you look for opportunity as well? >> i think so. seemaas just talking about emerging markets and, yes, there are risks. if you look, take a step back and look at these demonstratio, near term that is an economic negative if things aren't getting done, but if you looked at what all of these protesters want, generally more equal income distribution, that's pro growth because $1 going to theower income is going to be spent. $1 taken away from the highest income will likely come out of savings. thatl ultimately w pro growth. we have a valuation spread between foreign and u.s. as wise it's been in more than ade de. i do think we're going to see the foreign markets catch up as long as the economic growth continues, and i don't see a

recession on the immediate horizon. >> jack abn with cresset capital. happy holidays. >> thank you, bill. on theom ec sales of newly built homes came in a little lht in november. as diana olick explains, builders are poised for a big year in 2020 if they canhange one thing. >> reporter: home builders are incredibly bullish o their business right now thanks to strong demand and a severe shortage of existing hes for sale. home shopper signed more coracts to buy more homes in october but october' numbers were down. sales were up a strong 17% ycompared with ar ago. new homes have been selling at an annualized pac at 700,000 for five of the past six months, the first time since before the recession. much of the strength in new housing is being fueled byga lo mo rates, a full percentage point lower than they were a year ago. says rates will hold where they

are not only through next year but also through2021. the only thing holding builders back from more robust sales is price. the median price of a new home was up a sharp 7% annually. is shift was due to an increase in the numberom of hes sold above $400,000 and a decline in those sold below 300,000. armand is strongest on the low end of thet as millennials move from renting to buying. unfortunately, that's not where builders are putting up the most homes. coming up, three dividend paying stocks in a tough sector that our market monitor says you need in your portfolio in the new year.

it has been quite aear for california's largest public utility, pg&e. that company has been reaching multi-billion dollar settlements with wildfirti v and others t. doesn't have the blessing of governor newsome to participate in a wildfire fund. jane wells takes a look at what's next. >>verything burnt.on everything was except for what we took. >> reporter: george ander joyce ost their home and business when fire barreled through the town of paradise, california, last year, an event caused b pg power lines. >> sometimes i i wonderyou can put a value on all the memories, like my wedding bell or my mother's afghan tha she made my

dad for his first anniversary present. i don't know how you put a value on that. i couldn't even imagine how to >> reporter: this is what their properties looked like after the fire swept through. the myers are now in line with tens of thousands of others to be compensated by &e and a $13.5 billion settlement, shares at were decimated last year rebounded with the news of the potential paut which was approved by the bankrupy judge, except a settlement along with billions more are promised to insurers, regulators, cities that's because pg&e's repayment plan needs a settlement and there is one big holdout, california's governor. he wants a whole new board for e company and he's also concerned the current plan does not leave pg&e strong enoughll financy. without his approval,

california's largest utilityt my emerge from bankruptcy wh a newund to cover the cost of future wildfires. if that doesn't happen, allets are off. >> unfortunately if pg&e is liquidated and its assets sold off, it's likely theilire victims would get very little if anything from those sales. p reporter: the myers have cleared theirperties of debris as pg&e says it's willing to talk to the governor about an acceptable ph forward. >> i think a person should be happy if et back close to where you were. >> just want to go home. >> reporter: for "nightly business report,jane wells, jpmorgan upgrades . that's where we begin tonight's market focus. thepost-it's note maker was upgraded from neutral to ig over. they pduce fluids and a brace

sifs used in the manufture of computer chips. price target $150. deares up nearly 2% to $178.47. jd.com is conng an ipo overseas for the logistics unit. reuters reports the chinese ecommerce company is talking with banks and targeting a vaation of at least $30 billion overall. shares rose more than 2.5 to $36.26. brookfield is buying cincinnati bell for more than cincinnati bell's network serves more than 1.3 millionth homes. deal is expected to close by the end of nexpiyear. sharesd by more than 10% to $10.45. serepta hherapeutics struck a deal in a deal worth more than

$1 billion. roche will have mor rigs to the gene therapy outside of the united states. serept rose to $135.58. all week we were getting you ready for the new year by bringing back market monitor guests. tonight's guest likes defense stocks. last time she was on recommended visa which over the last year is up 32%, master card up 46% a paypal up 26%. we welcome back mariann marianne montagne. grad to see you back. >> this theme is energy.. it's a tough sector. you're going for the dividend as well. we start with exxon mobil tonight. why that one? >> right. well, i guess just as a backdrop, as you said, energee

has a tough area, and we like the sector now becausee like the defensive types of names. >> right. >>y ene fits in there very neatly. global energy producer.rated they've had severalct pro in the work that will come on over the next couple of years to drive cash flow and sustain that 5% dividend yield, which some we're pretty comfortable to tha so we like exxon dmobil. n a couple of etfs. why that one? >> so that's a broad-baseden gy play. we just think the $60 plus oil prices right now are we think opec plus, the opec groups will cut back on what they'v already offered to us. that's goi to sustain that.

xle offers a 3.6% dividend yield, probably going higher. a l of companies have already cut back on capital expenditures to help drive their cash flow and that's probablybottomed. so we should start to see some more money move into the oil services group as cital expenditures start to turn up. >>finally, boy, here's one with a very attractive dividend yield. 9. yield right now. >> you know, theab sustaity of that income had been questioned in the past and the valuation was cut in half if you look at it on an eb to ebitda basis. it's sel at 10 times forward numbers. we think the 9.7% yie is sustainable. for people who are looking for an alternative to bonds, really, you ow, the volatility is going to be higher than bonds but it's not really hher than

the overall stock market. o have market type of volatility, 9.7% alone is vy positive. >> always good to see you. happy holidays. >> happy holidays to you and yours. the battle for your video game dollars are becoming more intense. are gameti con soles the go-to gift for the holidays? as expected, disney's latest instlment of the "star wars"ga "the rise of skywalker" won the box office. it pulled in $146 million. while that fell shortopf the ening haul for the two previous movie in that series, it was still one of the biggest

debuts of the year. finally tonightor the last asveral decades many kid, even an adult, hoped for a video game console for the holidays, but the rise of mile gaming and streaming has put a dent in the popularity of the traditional console. jo liptonoo takes a lk at whether this elong-tim staple of a gift still has a place under the tree. >> reporter: will video game con soles be a hot holiday item this zbleer maybenot. shipments are expected to total 37.5 million units in 2019. that's a 13% drop. nintendo fans are still buying conoles but others are holding off because they know new ones are on the way. they'll be available late next year. theym expect t to be faster with better graphics so which one has the edge? analysts expect sony to sell

more conoles thanicrosoft because it boasts a bigger brand in more markets. we can't know for sure, they that, ntil they've done they arrive at an important tim for the industry. mobile gaming continuesw to g strongly and there is a rise of -- in streaming services, too, likeoogle stayed yeah which for $10 a month allows fanso stream high quality games to their pcs, tvs and pix pixelated phones. for example, microlans to formally launch its own game streaming technology nex year though the company isn't yet detailing price oct an e launch date. sony and microsoft have long battle in this console market but they now see the advantages of working together, too. earlier this year the two companies announcy that t

were exploring a new partnership, including sony's m use ofrosoft cloud services for game and content streaming. fo "nightly business report," i'm josh lipton in san fran bsco. aore we go, one final ok at the day on wall street the rally continued more records. dow up 96 points. nasdaq climbed by20. the s&p was up 2. that is "nightly business report" for tonight. i'm bill griffetho thank youch for watching. have a great evening. see . rr

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