>> tom: tick-tock. lawmakers in washington work around the clock as the deadline looms for the federal government to shut down. >> we're not there yet. >> in a little more than 24 hours, unless we work something out, the government will shut down. >> susie: there are new ideas, but not a lot of optimism as both sides begin another late- night round of negotiations. you're watching "nightly business report" for thursday, april 7. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by:

this program is made possible by contributions to your pbs station from viewers like you. thank you. captioning sponsored by wpbt >> susie: good evening, everyone. all eyes are on the white house tonight as the u.s. inches closer to a shutdown. president obama is set to meet shortly with key republicans and democrats for another negotiating session to get a budget deal. tom, the meeting is scheduled for 7:00 pm eastern time. >> tom: susie, if they don't agree, we're facing the first federal government shutdown in more than 15 years. meanwhile, the house okayed a stopgap budget bill to fund the government for another week.

but senate democrats oppose it and the president says he'll veto it. >> susie: the clock is ticking toward the deadline-- friday at midnight, eastern time. darren gersh looks at the issues holding up a budget deal. >> reporter: this morning, democrats and republicans seemed to be moving further apart. house republicans pushed forward a one-week extension of funding that the president promised to veto, and house speaker john boehner insisted on controversial policy changes. >> americans are also concerned about how much we're spending, but also how we are spending it. that's why we're working not just for the most spending cuts possible, but also "common sense" policy restrictions on how taxpayer dollars are spent. >> reporter: those restrictions would limit funding for abortion services in the district of columbia, and prevent the e.p.a. from regulating greenhouse gas emissions. senate majority leader harry reid rejected those changes.

he said they should be made in law, not in a spending bill. >> so if this government shuts down-- and it looks like it is headed in that direction-- it's going to be based on my friends in the house of representatives, the leadership over there, focusing on ideological matters that have nothing to do with funding this government. >> reporter: this afternoon, the two men met with the president, and emerged to say they were going to talk some more. >> i do believe all of us sincerely believe we can get to an agreement, but we are not there yet. >> we're going to continue to work to get this done. it's not easy to do, but it's doable. >> reporter: a shutdown now will have a much greater effect on the private sector than in the past, because more of the federal government's work is now done by private contractors. stan soloway represents those workers in washington. he says its unclear whether they'll be able to make up any lost pay.

>> there will definitely be layoffs if there's a shutdown that goes beyond a couple of days. it's almost inevitable. the longer the shutdown, the more layoffs we will see of companies of all sizes and kinds. >> susie: darren joins us now with more on the budget battle. what changes have we seen in the last 24 hours? >> so they've gotten a little bit closer, we're hearing there a couple billion as part which is not a lot of money. so the numbers seem to be coming closer together. the sticking point still seems to be these policy issues. and those are always the toughest issues which is why they save them for the end. it's possible that some indications that republicans might be easing their language on abortion restrict-- restrictions this is very fluid, very much in flux and it's too early to tell. >> and you know it's interesting on another side of this, here i am, down on wall street and the financial market have really not responded to the whole budget battle. why do you think that is?

>> i was a little surprised by that. i did talk to somebody who follows markets quite closely. and i think they're looking at this as kind of the preseason. you know, the final four, if you will, is going to come when the debt limit is at stake. that's when the issue of whether or not the government is going to be able to issue new debt and markets are going to follow that very closely. and that is when are you going to start to see markets respond to maybe all the twists and turns and the stakes will be higher. >> you know, this skirmish does make you think more about the bigger issues. if lawmakers are having a tough time on agreeing on cuts of billions of dollars how are they going to deal with the bigger long-term issues of trillions of dollarses? what are we in for? >> what are we in for? more of this. i mean just racheted up. house speaker boehner today was talking to reporters and it was interesting that he said, you know, after this comes the hard part. so they are going to have to deal with the debt limit there are a lot of members of the tea party who said

they won't vote for an increase. that's going to be what we like to say in washington now, i guess the term is an adult moment. and then they have to argue over the 2012 budget. so the harder stuff is coming. and these two sideses are getting used to each other. they're positioning, they are trying to figure out how to work together so they're being tough up front for the battles that are to come. >> and they certainly are going to be battles as you just said. darren, thankses a lot for coming on and explaining it all. >> sure, we'll do it tomorrow too. >> susie: y, we will, speaking with darren gersh our washington bureau chief. >> tom: for the first time in almost three years, the european central bank is raising its interest rate. policy makers bumped the benchmark to 1.25%. it had been at a record low 1% since the spring of 2009. the e.c.b. is fighting inflation as several euro nations struggle to get debt under control. while today's rate hike was anticipated, it is still making many u.s. investors uneasy. the federal reserve isn't expected to hike rates anytime

soon, but most wall street pros think its just a matter of time. as erika miller reports, now may be the time for bond investors to get ready. >> reporter: on bond trading floors, there's no hint a sea change is coming. but fixed income expert jonathan beinner says the era of big bond returns is over. >> if you think about the period that we've been in over the last couple of decades, bonds have been the place to be. to be able to have those really stellar types of returns is unlikely, and i think investors should be pretty cautious about the risks they are taking in fixed income right now. >> reporter: to beinner and others, today's rate hike by the european central bank is another hint the federal reserve could start raising rates later year. the timing will depend on how quickly inflation creeps higher. credit suisse's ira jersey says the other big factor is the job market. >> if we continue to have somewhat higher than 200,000 payroll prints, we start to get wages up, we start to see the unemployment rate fall a little

bit more than it has, then it certainly gives the federal reserve a little bit more ammunition to do that. >> reporter: so what should bond investors do? there are complicated hedging tactics, but for many people, it may make better sense to take the money and run. for investors seeking income, some strategists recommend creating a laddered portfolio of short-term treasuries. >> if you own individual securities, like a two-year or three-year note, then you have the option to hold those to maturity, and in holding those to maturity, you can invest the money at higher yields. >> reporter: those with higher risk tolerance may want to consider floating rate funds. they hold adjustable rate bank loans, often made to companies for buyout deals. so as interest rates rise, those funds tend to do well. >> they give you a credit spread, but if interest rates go up, the securities themselves, the rates on those securities, actually go up with it, so that's another opportunity. >> reporter: many investors don't like the prospect of lower bond returns. but there is an upside. when rates rise, it's a reflection of economic optimism,

hope that the recovery is finally picking up steam. erika miller, "nightly business report," new york. >> susie: here are the stories in tonight's "n.b.r. newswheel." stocks slipped after a major earthquake in japan reignited fears about a nuclear crisis. the dow fell 17 points, the nasdaq lost threee, the s&p 500 off two. big board volume rose above 900 million shares; nasdaq dropped below two billion shares. oil prices are now at $110 a barrel, the first time in 2 1/2 years. in new york trading, crude futures jumped $1.47 to $110.30. but consumers are still spending, despite higher gas prices. the nation's retailers reported a sales gain of 1.7% in march compared to a year ago. economists were expecting a drop in spending, especially with the easter holiday coming late this spring. among the top performers: limited brands, parent of

victoria's secret, posted a sales gain of 14%. costco rose 13%, while luxury department store chain saks saw an 11% rise. more good news on the jobs front. weekly jobless claims fell again, suggesting slow but steady improvement in the job market. requests for unemployment benefits were down by 10,000 to 382,000 last week, the third drop in four weeks. and still ahead, "kids and cash," our series has tips for teens on how to land a summer job. >> tom: as susie just mentioned, a powerful earthquake hit japan today. it struck the same area destroyed by disaster a month ago. today's quake registered 7.1 and was centered 40 miles off shore from the city of sendai. officials called it an aftershock from the march 11 quake. a tsunami warning was issued, then cancelled 90 minutes later. workers at the damaged fukushima daiichi nuclear plant were

briefly evacuated, but work soon resumed pumping water into reactors damaged from the first quake and tsunami. power was interrupted at two other nuclear plants which had been shut down by the earlier quake. more on the market reaction coming up in "market focus." >> susie: back in the u.s., the justice department wants to get its hands on records of american clients of hsbc in india. the feds suspect the clients are hiding accounts to evade taxes. court documents allege hsbc lured americans with the promise of secrecy. today's request comes amid a crackdown by the i.r.s. on offshore tax cheats. hsbc says it does not condone tax evasion. meantime, convicted ponzi schemer bernie madoff says a few big banks, including hsbc, will likely end up paying big money to his victims. in a jailhouse interview with "the financial times," madoff alleges j.p. morgan chase, the primary banker for his firm, had enough information about his account to be suspicious.

the trustee liquidating madoff's firm sued the bank last year for $6 billion. he also sued hsbc for $9 billion. madoff predicts that bank will have "big problems." hsbc says it didn't know anything about madoff's fraud. >> susie: tom, it is a few points higher, a few steps back and today with the step back, it shows that there is

a lack of conviction by investors. >> tom: a lack of conviction, while we're still close to post rehis-- recession highs but not a lot of volume, not a lot of volatility in the market and that goes tore today as well. let's get everybody updated with tonight's market focus >> tom: the strong earthquake in japan and the lack of any budget deal in washington helped send u.s. stocks adrift, ending with small losses. consumer stocks held their own, though, in part on the heels of good jobs data and retail sales. home depot was the best dow industrial gainer, up almost 1%. that puts shares less than $1 away from a 52-week high, and close to the top of its recent range in the upper $30s. among the retailers putting up good numbers in march-- discount warehouse costco. march same-store sales jumped

7%, much better than anticipated, and the stock climbed almost 4%. it takes costco to a new 52-week high, and on almost three times its average volume. costco wasn't alone in hitting new highs. bed bath and beyond did the same, jumping more than 10% after earnings were much better than expected. pier 1 was up 10% to a new high on strong earnings. and the buckle also is at a new high as march sales increased more than 8%. japanese stocks remained in focus with the biggest aftershock today since the march 11 earthquake. this is the past 90 sessions of the i-shares japan exchange traded fund. this sharp drop and snap back came the week after the big quake. with today's drop, the index has given up most of that bounce back. here's the past 180 sessions of toyota motors.

volume was heavier than usual today on the earthquake news. shares dropped only 14 cents, but are hitting new lows since the disasters. the industrial sector led the market losers in the u.s. caterpillar and general electric, both dow components slipped 1%. but ingersoll-rand was a sector stand-out, up more than 1% after raising its dividend and okaying a $2 billion stock buyback plan. this is a new high for shares of i-r. the worst s&p industrial stock today was southwest airlines. l-u-v saw very little love from investors. shares fell 3%. this is the past 90 sessions. the stock has lost more than 7% since the day before one of its planes had its roof rupture in mid-flight. while gold and silver had been hot metals, we saw rare earth

mineral miners hopping today. molycorp is developing a rare earth mineral mine in california. shares added another 10% today. canadian miner rare element popped 16%. meantime, gold and copper miner newmont continues digging itself out of its recent stock price hole. shares up another 3%, up to their highest price since february. it boosted its production targets and will base its stock dividend on gold prices. a couple of biopharmaceutical drugs are living up to their industry's reputation for volatile stocks. xenoport rocketed up 56%. but even with that, the stock remains below where it was last spring. the fda okayed its drug for restless leg syndrome. and immunogen jumped 27% with positive drug experiment data on a treatment for breast cancer. tomorrow, watch shares of online

travel company expedia. the stock was up as much as 13% after the close. it has preliminary plans to split into two companies. and that's tonight's "market focus." >> tom: sunshine and sand are great for the tourism business but not street gangs. several of america's biggest cruise ship operators are steering past one mexican port of call over fears of violence, gloria guevara manzo is the secretary of tourism. nice to see you.

five cruise ship operators have recently stopped stopping in mazatlan like karnal-- carnival and disney are included in this group. are you going to be meeting with them this week. what will you be telling them to a sage their fears. >> mexico is very important for the cruise industry and we appreciate the cruise lines and their business. just to give an idea, we received last year more than 6 million passengers from all these cruise lines that stop in the different portses throughout the country. now something that we're working with them is defining and how do we improve the relationship so they are more comfortable and at the same time, increase the number of passengers and travelers to mexico. >> tom: very important for the tourism industry in mexico, a growing business. is what it that the cruise ship operators want to hear in terms of investment so they feel comfortable coming back to mazatlan and staying in the other ports of call. >> they have been telling us a couple of things. the first one is that we need to have very good

communication. in other words, we need to be very-- in telling them what is going on, the thingses that are are improving. and what is going on in every single port. the other thing they shared is we have to improve the product in some of the destinations. yes, you look back, we have some itineraries for the last 40 years, for instance, in the pas civic coast. and we are work on improving the products so that the travelerses can have a better experience. and those sort of conversationses that we're having with the cruise lines. >> tom: most of the cruise business is along the pas civic coast well. will look at a map of the more popular mexican ports of calls. mazatlan on pacific coast and ago pole co, both have seen street violence lately. what kind of investments is your office and the mexican tourism industry putting in on the ground in these locations to adds res some of the safety concerns. >> well, we have different initiatives. we work closely with the cruise lines and work very closely also with the different offices throughout the country like the state,

the municipals in order to guarantee the experience of the travelers. in mexico we have a challenge but the challenge that we're facing is not a against the civilians or tourists. and the reality is that we have seen an increase in the number of travelers we receive in mexico. just to share some numbers with you, in 2009, for instance, january to december we received a little bit more than 21 million travelers. these are arrivals that stay at least one night in mexico. last year we saw an increase of 22.4. why is that? because there is a very lot of people are finding mexico, they are getting great experience or great experience for their dollars. >> and speaking to one of the challenges you have is the continued increase in the value of the peso against the dollar. today at a one-year high this makes mexico more expensive. what are you see on the ground? >> mexico as has been very well. our economy is growing. we are creating a lot of

jobs, the industry in general is doing excellent. we also see that as you say the peso is getting stronger but when you compare the value that you receive in mexico, the experience, the hospitality, the food, the overall experience versus the other nations we're still very competitive. >> tom: we appreciate you sharing that competitiveness with us. and the business opportunities that american operators are seeing there. the mexican secretary of tourism gloria guevara manzo. >> susie: here's what we're watching for tomorrow: wholesale trade inventories for february are released. atlanta fed president dennis lockhart is in knoxville to speak on the economic recovery and monetary policy. and tomorrow's "market monitor" guest thinks the bull market should last a long time. she's elaine garzarelli, president of garzarelli capital. it's official-- satellite company dish network is now the new owner of blockbuster, the former video rental giant.

a federal bankruptcy judge today okayed the $320 million deal. for that price, dish gets blockbuster's stores, customer lists, and most importantly, its digital business of streaming movies over the internet. blockbuster filed for chapter 11 back in september with more than a billion dollars due to creditors. >> tom: it's back into the skies on saturday for four southwest airlines planes. the four have had repairs made to cracks in their aluminum skins. dozens of southwest's boeing 737s were inspected after a hole opened in the roof of one while in flight last week. that plane made an emergency landing in arizona and is still being repaired.

>> susie: this summer is expected to be another tough one for teenagers looking for jobs. last year, teen job seekers had the weakest summer job market in decades. tonight, our "kids and cash" series has advice for young people looking for work. here's janet bodnar, editor at "kiplinger's personal finance." >> the outlook for summer jobs isn't much better this year than last, and last year was pretty bleak. the number of jobs is down from its peak, and competition is

tough with college grads and older workers. but there will still be nearly a million summer positions. to land one of them, start your search early, like now. and be professional. write a resume that includes anything that makes you stand out-- grades, extracurricular activities, sports teams. next, get away from the computer. scouring online job listings and sending emails to prospective employers is a good place to start, but its even better to call or show up in person to make an impression. finally, if you cant find a traditional job, or are too young to look for one, use your talents to set up a business of your own. it could be mowing lawns, organizing a babysitting service, or tutoring kids-- and adults-- in computer programs and social media skills. i'm janet bodnar. >> tom: just a reminder: you catch us online at nbronpbs.org. you can comment on our blog or watch any programs you may have missed.

follow us on twitter at "biz report" or my personal feed at hudson n-b-r. if tweeting isn't your thing, friend us on facebook at "biz report." finally, something you may know if you pay attention to who's driving what. a new study finds, when it comes to cars, men like looks, women prefer practicality. truecar.com looked at data from eight million purchases in the u.s. last year. the brand with the highest percent of female sales was bmw's mini, followed by kia and honda. guys like fast cars. their favorites are ferrari, lotus and lamborghini. the top-selling model for women was volkswagen's new beetle. susie, for men, it's the porsche 911. men arc parently still like to dream about all that horsepower. >> susie: tom, i'm practical in a lot of things in my life but when it comeses to driving i don't follow that mold. will you find me behind the wheel of a porsche. >> tom: i'll be behind the

wheel of a volkswagen, as a matter of fact. >> susie: what a pair we make. >> tom: how about it. >> susie: that's "nightly business report" for thursday, april 7. i'm susie gharib. good night, everyone, and good night to you, too, tom. >> tom: good night, susie. i'm tom hudson. good night, everyone. we hope to see all of you again tomorrow night. "nightly business report" is made possible by: this program was made possible by contributions to your pbs station from viewers like you. thank you. captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org >> be more. pbs.