this is "nightly business report" with bill griffeth and sue he> od evening, everybody, and welcome to this special edition ofgh "y business report." sue is off tonight. with the stock market closed this chrtmas day and 2019 wrapping up, it's a good time to take a look at the year ahead to figure out what may be in for the markets, the economy and your money. so that's what we're going to do tonight based on what we already know and what the experts so we begin with two reports on things we cover every day. steve liean will take look at the economy, but first bob pisani has the outlook for the stock market from the new york stock change. >> reporter: oil stocks bounce, rates go up and the direct

listing craze will peak ree predictions for 2020. first, against all odds, energy stocks woutperform the s&p 500. it's been a lost decade f energy investors with oil stocks up to 6% in ten years but a combination o high dividend yields and relatively low earnings multiples will make severalom mnies muche attractive. bank of america believesl exxon mo could move up 50% to $100 ast sells assets, expands production and doubles c itsh flow by 2025. second, lower rates in 2020? no necessarily. many central banks don't seem to want it. shifting political winds in germany will leado the passage ofcaarge stimulus plans to boost the slower economy.ro euan bond yields wl move back towards positive territory. european bonds all while pushing european yields higher and t keepin bank rally going.

finally, the direct listing craze will peak when airbnb goes public during the listing. it's allhe rage. private equity investors are pushing direct listingso cut costs and allowing employees and no one asked the buy side. dict listing spotify and slack are und performing and a disappointin airbnb debut will convince many that all ing early investors to sell at once may not be right for everyone. for "nightly business report," i'm bob pisani at the new york stock exchange. nothing is more central to the outlook in 2020 than what happens in the trade war.se depr growth here at home and around the world this year. it led the federal reserve to reverse course and cut rates sharply in 2019. here's what to look out for in 2020. t first, trade war should improve somewhat or at least not get worse. asrehe year to a close that seemed to behe case with the announcement of a limited

u.s.-china trade deal. uncertainties will remain but businesses will learn to iest and prosper with a constant rumbling of trade diutes. second, assuming a lot of damage hasn't already been done that should hp to lea to improved global growth. that can help u.s. globaltorowth 2.5% or a half point wheret was in 2019. third, the federal reserve should remai on hold and it could consider raising rates if globalwth and global inflation start to hike. for "nightly business repmt," teve liesman. and as steve just mentioned, trade was one of the defining economic issues. even though progress was made, there are still a number of things yet to be resolved. kayla tausche takes a look at what 2020 might hold. >> reporter: the tnimp admiration rocks the trade boat in 2019 with unpredictable tariffs a short-lived truces. move back tow the status de will quo.

a simmer.ina tensions return to fireworks will fade when the u.s. and china sign offn a ary.e one deal in early a second deal will remain far off. if china engages and enforce the first deal, expect tariffs to be rolled back owly. second, farm finances will be in focus. as planting season gets underway, american farmers will size the pain of a two year trade war. agriculture secretary sunny purdue says moreci fin aid will be warranted if the ag economy doesn't rebound qukly. third, europe will be back in the cross hairs as president hone in on a new targ, the with ridsing tariffs will have energy sanctions and he'll pocket those fhts until after november. i'm kayla tausche in shington. joining us now to talk about what they see ahead for the

ecomy and t markets next year, we have jim o'sullivan with us. chief u. macro strategist at t.d. securities. john lynch is chief investment strategist at lpl financial. good to seeboou . >> hi, bill. >> thank you. >> jim, let me start with you. we laid out here there were so many walls of worry for the markets in 2019, trade, the fed, on and on, slow growth overas. many are starting to be resolved right now. what is your outlook for 2020? >> ll, i think there will continue to be some anxiety and volatili along the way but in the end growth will remain modestlypo tive. alrey record low expansion will continue at least at a weak pace. the unemployment rate is already at a 50-year low at 3.5%. yment ratee unemp stays low. i think we haven't necessarily seen the end of the follow through or weaker global growth or trade tensions. for now the global backdrop is

still pretty weak. i think in the end the economy will continue to grow at least modestly. >> dyhn, we've alr seen a slowdown in hiring to begin with going into 2020. what other areas do you see that you're going to be watching carefully going into the new year? >> i think theost important area -- on the hiring thing, i think we have to modertte a bit, right? year 11 of the cycle. i think the most important thie is get clarity on trade as to whether or not business resumes investment. at's really the key, i think, if you want to consider businesses investing, that enables productivity to continu to gw and what the market translation for that mis,kets can be sustained. last year we saw price dramatically outperform earnings. to the degree we have a better year ithe stock market, we really need to see margins sustained. if we geturther clarity on business investment has productity and couldead to upwards business earnings investment. >> we've gone through a few

cycles in the market in the last couple of yearshere. there will be a period of time when money managers want to look to growth stocks but then they shifted to defensive stocks when the trade was really heang up at some point. now they've reallyk migrated b to the growth stocks again. what do you think will be the better performers in 2020? >> well, i talked more about the economy than the stock market per se, b i would say the backdrop is such that the tone is certainly better in terms of people feeling lessri w about recession risks. with that said, it's notll clear sailing either, i would say. backdrop isglobal stil on the softer side and trade policy uncertainty hasn't necessarily gone away either. far as the stock marketnd earnings go, yes, the p was up a lot more tha e and e by many measures was down lot in the last year. it may be harder toqueeze much earnings growth out of the e and out of the economy at this point in the cle. >> i guess what i'm getting at

those companies that are involved in international trade? those multi-nationals in the united states that have been suffering to some degree or did for a time because of the trade tensions with china? what happens now do you think? >> it's a question of how quickly does global growth come back. certainly it's wositive that ha the u.s.-china trade deal. there's still uncertaintyf there's followhrough on that. kayla menoned what happens with europe as well. they're on the softer the manufacturing numbers are on the weaker side. the trade deal, assuming it happens in early january, is goingo cau global growth to snap back. i think the backdrop is still on the softside. >> john, where do you standhen wh you should look for the high growth stocks again in the new year or stick wit some of the value and defensive plays out there? >> we're pairing back on growth.

it's more of an equal weight right now. to your point about those companies benefitting from the l re o global trade, if you look a the earnings forecast for 2020 we're lking at 15% earningsrowth for industrials and the energy space, a twoas that have been affected quite a bit. sectors. two of the leading ou factor in the potential for higher market interest rates that would bode well for the financial sector. >> jim o'slivan and joh lynch. thank you both for joining us. >> thank you, bill. >> thank you,bill. 2020 also brings, of course, a presidential election, and the final yearf president trump's first term. what should investors expect? here's eamon javers. >> reporter: toas parap winston churchill, it's either the beginning of the end of the trump presidency or just the end of the beginning as the president ramps up his re-election campaign.

first, the president survived impeachment. conventional wisdom says a traditional vote in the house will be followed by the senate leaving it. second, legislative letdown. the president began his first term with efforts to repeal obamacare which failed cut taxes which succeeded and slashed regulations which he has done.th e's not much left on the president's agenda. they're not likely to pass the iesident's prioritiesthe year. don't count on a lot of bill signings in 2020. third, it's all aut thatbase. he will campaign the same way he won in 2016 with a laser focus on his political base. for chief executive who's there, he knows he needs every

voter. that means we'll see an emotional, divisiv and dramatic election. i'm eamon javers at the white house. anwhile, on capitol hill is regulating big tech. ylan mui is covering that story for us this year. big tech w a big target as the 2020 elections get closer. watch out for aapol hill crackdown. they will wrap up the antitrust investigation next year. democrats want the top techceo to prevent it. build support f a federal privacy law. both parties are raising redag over chinese companies likei hua and tiktok.

the ftc and justice department will try to foc the antitrust investigations into texas and california's strt new privacy law goes into effect. the most heated rhetoric should go in the privacy after the fallout from2016. facebook in particular is dealing with t. all of the platforms are under pressure. ey need to show they've learned a lesson from e last election. for "nightly business report," i'm ylan mui in washington. still ahead, one of the bigges corporate stories of 2019 will likely dominate 2020 as well. i

>>was another strong year for the labor market. 2019 brought the lowestun ployment rate in 50 years, and one of the biggest challenges thatompaes faced was finding those skilled workers. here's kate roers. a hot economy l to a tight market with education and healtl servicessure and whose pi till the and business services le.ing the job mark here are the predictions for the labor market in 2020. first, wkers remain in high de19nd. as truly an employee's market as companies across seors named finding and

keeping talent a top challenge. expect the trend to continue next years unemployment remains historically low. babyooomers continue age out of the work force leaving an even smaller pool for employers. second, incentives a training continue. upskilling or training workers already eomloyed by a is a move many eloyers are making and the supply ofilable talent rains low. training programs along with incentives and more robust benefit offerings will be key. third, tech continues to trade the game. rom manufacturing to retail, technology is becoming an inkraed sippingly part of the discussion for workers. r "nightly business report," i'm kate rors. >> real estate market went from hot to cold and then it starte to warm upagain, but next year could be a whole new ball game for housing. here's diana olick.

>> reporter: the housing market is a m of highs and lows. here's what to watch in 2020. ngrst, the hou shortage will get shorter. the largest generation is aging into the home buying years. the demand l is on t end cere supply is leanest. it willse prices to risen o the lower level. second, mortgage rates will stay low. mortgage rates dropped in 2019l and w likely stay low through 2020 as uncertainty over a trade war and presidential election year keep investors heavy in the bond market. mortgage rates loosely follow it. the only wild card is finance reform. rates could break hher if rules are changed. the combination of a major housing shortage a health care will keep rates high.

the home builders have been ramping up production and in entry-level homes. pivot to if they can afford to put up more big sales numbers, we'll follow. their headwinds continue to be high prices for land, wind and rethe . joini us with her predicons, darryl irweather is chief economist. thank you for coming back. >> thank you for having me. >> in the last month or sous g starts were higher. the permits were at a 12-year high. builders themselves saw more optimism going into the new year. does that mean housing is looking up muc going into 2020? >> i think the housing market is going to beuch more competitive in 2020. right now 1/10 of offers face competition. i think that's going to go up to

1 in 4. >> therefore, you think we're going to see the return to biddingn wars many markets >> that's right.ry? where they were prevalent.places we're going to see a return in bidding>>wars. hat doesn't help the low end, the starter home buyers right now where there has been just a dirth of supply. what's theouook? >> first-time home buyers are going toarave ar time. they'll lose bidding wars. they've been in the market and make all cash offers. first time home buyers will have a much harder time next year. >> the higher end othe market has struggled becausef those higher prices where the affordability became an issue. you're talking about higher

prices next year. won't that still be a problem? >> home price growth won't bqu end. strong in the luxury we've seen markets like san jose where therere 1 million, $2 million homes go down. they'll be looking, strong but days of 20% price gwth in these luxuryon markets are past. >> you mentioned the san jose market. let's talk about some other local markets around the country. like in the sunbelt, for example. will we see better marke there, for example? >> reporter: a lot ofigration in the red fin data. people looking on the coast into places like texas, arizona, other affordable markets? >> they tend to be more affordable. they should do ptty well in 2020. >> what about in the industrial base, in the country? there is a revival going on in

the northern parts of the united states. what do u see there? >> larger cities like cleveland, detroit, buffalo, those markets will do well. some of e more rur parts we'll probably lose people and those markets won't be as rong. >> thanks again for joining us. >> thank you. >> you've got it. one of the biggest corporate stories this year was boeing's 737 x. most likely going to be big news again in the new year. at issu o all that uncertainty over when the trou plane will be back in the air. >> next year boeing's 737 max the head othe faa, steve dickson, says he won't approve the max before he flies it himself. ere are still aumber of hurdles to clear before the max takes off. most people belve i will be

recertified in the first part of the year. make a big push to convince the max is safe. southwest, american, united have parked their max plaals for most a year. they know passengers may hess tad or flat out refuse to help the children. once the max is ooback, l for boeing to slowly ramp up production. yes, the w assembly linel be down at the start of the year but boeing will likely go to building 42 a month by mid year. what about the max airplanes, they will take off and go to airlines that will order them. it will take all of 25020 for boeing to clear out the inventory of max reports. earlier this week, chang arted witthe ouster of ceo

david me lenberg. david calhoun will take over in january. coming up, why the great divide why the retailersinre beginninhe new yea the consumer definitely powered the economy in 2019. spending was strong becau companies kept hiring, but that doesn't mean all retailers reap

the rewards. >> reporter: 2019 was a difficult year for retail with clea winners and losers. continue in 2020.ence to first, the paris divide.nu it con to evolve. brands aren'taiting to adapt. some of this is easier than he . big retailers like target, wallet, best buy, you scale and influence. you insist the brands they buy from take on whatever highe costs result. second, old is new again. as the retail market expands, see how we sell mts secondhand. watch for retailers to deploy.

new strategies many retailers have and they will have new ceos settle in for the new year includinged bath & beyond, nike, tapestry and they're waiting to see ifhey will shift io new directions and then decide if they need to make them tell. >> it's hard to mention retail wigout mentionecommerce. the fact that most consumers expect their packages to be delivered asap. frank holland has that orstory. >> rr: 2019 is oftenace to be another one. forecasts increase as much as 14% for the retail federation c and thetinue is going to continue in 2020. you'll expect s.ta it could grow at a $4 trillion

across 2020. had the potential for lger, same day, next day shipping. also, total sales by phone are expect ted to. grow amazon currentlyra opes 50 planes and expects to have 70 flying by 2021. look for acquisitions in 2020 ay continue to grow its pacity foreground logistics and delivery. third, drone delivery. >> fedex and usps are bh battling and testing. amazon gndgle also have their eyes on the skies when it comes shipping. 2020 may be the year e. commerce

takes shape. finally, the changing way we all watch television. new streaming services are he ever with more ctent available at the touch of a button. what will 2020 bring to this fast-chasing business. sit back and watch julia boorstin's report. >> in we'll see the volume battling for viewers. first, using more viewers. >> with nbc universal's peacock launching in april and this in may, we have disney plus and apple tv plus netflix will face deep thoughtnd to focus onl internatiogrowth. >> second,d supported streaming. with the free subscription business, netflix pioneered, now

crowded, consumers, advertisers and content creators for fr. nbc ease aun versal's peacock is going up against tumo. third, it will eat into the b office which will decne here. >> in a declining box office, elit's l to put pressure on studios' bottom line. for 19 business report, i'm julia boorstin. >> merry christm'l, everybody. see you tomo.

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