. this is "nightly business report" with tyler mathisen and susie gharib. >> collapse on after $80 billion deal. 21st century fox abandoned this pursuit of timewarner. what is next for fox and the pray that got away? >> sharp stumble, a lousy start to the trading day, and it got worse, but there are ways to protect your money in this market. >> road safety. the new technology companies are developing to cut down on the number of long-haul truck accidents and potentially save lives in our three-part series, collision course. that and more on "nightly business report" for tuesday, august 5th. good evening, everyone and welcome. i'm tyler mathisen. >> and i'm sue herrera in tonight for susie gharib. it was an ugly day at the open

and uglier at the close however strong earnings from disney could change the tone tomorrow, but we begin tonight with the $80 billion deal that seems to be dead. 21st century fox with drew the bid. murdoch side timewarner management and the board refused to engage with the company or explore a higher offer and the bid drove 21st century fox shares lower under valuing the company and upsetting too many shareholders. fox did approve a $6 billion stock plan. shares dropped sharply after the announcement. fox went the other way with shares spiking right after the news. >> is the deal really dead? let's get thoughts from tom edgen, he's a senior research analyst with the telse advisory group and follows media companies. welcome, good to have you with us. do you believe mr. murdoch is

going to go away permanently, and if so, why did he? >> i think the deal for timewarner is dead. you know, we weren't sure about it to begin with. we had a 50/50 shot and that's essentially because to net that leverage was going to be too high. >> you know, tom, there are those who say basically murdoch is raising more cash, he's going to make it a sweeter offer and he'll be successful. why don't you think that's in the card? >> if you include the proceeds that they get, if the bid is 50% cash, which i think is what timewarner needs and wants, it's still higher cash. the leverage goes to above four times. >> you know mr. bucas at timewarner has got the stock price up but the cost has been perhaps selling other elements of the company, timewarner cable, the publishing group, time inc breaking them apart. that makes timewarner more

digestible to another company. is there a company that might find timewarner too precious to pass up? i'm thinking google. >> possibly. there could be a tech company that's interested but to us, there wasn't another media company to make it big so for us, we said murdoch is negotiating against himself. >> i would assume it's going to be important to watch the dialogue that goes back and forth as investors and analysts and shareholders basically digest what happened late this afternoon. so what are you going to be listening for from both sides in this discussion? >> well, at timewarner, jeff needs to show shareholders how to enhance value. whether that's expanding hbo internationally, whether that similar proving the ratings at turner, whether that is increasing share at warner brothers. he has to show how to increase

value. at fox, i don't donthink they a done yet. they will spend 75 to $80 billion. there could be more to go here. >> you seem to be saying, tom, that the deal did not make financial sense for fox and that seems to be their conclusion at the leverage ratios that you describe. did it make business sense? >> well, i had a couple issues with that deal. for example, the emerging warner brothers and fox studios. warner brothers was 40% of the revenue. what would they do with two times the studio. i'm not sure if it made complete sense. >> thank you very much. we appreciate your perspective tonight. >> sure. earnings after the bell from disney, encouraging results that could set the tone for trading on wednesday. disney pulled $1.28 a share in the third quarter, the highest earnings per share in the company's history beating wall

street estimates. $12.5 billion revenue topped the forecast with a gain from the studio division. "frozen" was the highest animated film ever with strong results from parks and resort. shares were initially higher in after hours trading. julia boorstin spoke with bob and has the take away. >> reporter: disney's results on a range of the businesses, especially the movie division on the strengths of the "marvel" franchise. >> the marvel brand has arrived and healthy and "captain america three" and we just announced a 2013. >> reporter: what drove the parks division higher, up 8%

while operating up 23% due to a combination of increased guest spending and higher attendance. new day, different direction, the markets wiped out all of yesterday's gains and then some on worries strong economic data might jolt federal reserve policy and jitters about escalate tensions on the boarder between ukraine and russia. despite little other news, all the major averages began lower and sold off very sharply mid session. the dow at one point down as much as 180 points, ended about 140 lower, the nasdaq down by 31 and s&p 500 off by 18. while stocks slid, oil prices went along with the ride, ending at a fresh six-month low. west texas crude fell a buck a barrel to finish at $97.38. bob watched from his perch at

the florida new york stock and change and looks at what drove trading to the downside. >> reporter: stocks were weaker at the open and dropped midday and comments from the polish foreign minister russian units would invade ukraine. some of the damage may have been technical, the s&p dropped below friday's lows and is at the lowest level since april. >> these concerns did not just surface today. the trend has been poor since the end of july over concerns in the ukraine and europe in general, as well as concerns about higher rates in the united states. several u.s. stock sectors that have been weak for days were weak again today, for example, oil stocks have been weak all month, exxon and chevron were both down roughly 2% today and another dow component, ibm has been down five out of the last six days, down 1.3% today and financials have faired poorly.

jp and goldman sachs, a rough start to august, traditionally one of the weaker months of the year. for "nightly business report", i'm bob pissoni at the new york stock exchange. ways to protect your portfolio in a volatile system. >> tyler named the stuff troubling the market but you think it comes down more to the fed. >> yeah, i think if you start this period when the market is arguably over valued and i think common sense suggests that's the case. 30% move up last year, 8% move up this year. you got to get a correction. obviously, there needs to be an excuse for that. the excuse for that, more than just an excuse is the perception that the federal reserve is probably going to move up the timeline on when to raise short-term interest rates and that is going to aggravate

conditions. you know, we started this period thinking the market is pricey or over valued, add that to the equation and you put it all together and that gets people running for the exits or starting to sell stocks to protect themselves in the event this correction turns out to be something more severe. >> let me get your reaction to two sort of counter thoughts, he hue, if i might. one is the market is less over valued now than ten days or two weeks ago, that's number one and number two is, if interest rates raise as most people expect them to sometime next year, early, mid, whatever, it's -- they are rising for a good reason, not because there is a big flush of inflation coming that they need to catch and oh, boy the way, a little inflation, hue, is often a good thing, isn't it? >> it sure is. i think you start the whole problem is that you start this period being a little bit over valued, and so the question is

what is going to drive the stock market higher? the answer is the rising interest rate environment. not price earnings multiples. then you turn the focus on the economy and earnings and ask how will earnings be this year and next and come up with growth rates of something in the order of say, 2% this year, maybe a little bit more. 5%, 6%, next year you say, where is the beef? is it that's going to drive the market? you can't come up with anything. so you say to yourself, let's wait until things get a little cheaper or there is better opportunity, and that's exactly what sort of unfolding. we're moving towards better opportunities in the market. but it's really that valuation concern. >> now, if the volatility is going to continue, we task you with coming up with a couple strategies to protect portfolios in this environment. what did you come up, hue? >> number one, whatever happens, the on going correction, it's within the context of an on going bull market.

the first thing i would not do is reduce my allocation of stocks. in other words, keep a meaningful allocation of stocks th unless you can't sleep at night. the second thing you do when times get tough, you emphasize large capitalization stocks. during a correction or during a bear market. the third thing is within the context of the stock part of your portfolio, build some defense by owning safer sectors. at the top of the list is health care. you can also add utilities and telecommunications, although i don't like the sectors and the final thing is look away to other markets around the world. i think you see better perfo performance from some. these are things to do to keep a good allocation but build a little defense in your portfolio. a good idea now.

>> do you recommend individual investors should have stop losses in place? >> tyler, most individual investors should not do that and the reason i say that is because for myself or individual investors, it's very hard to call short-term swings in the market. that's why i say, most individual investors should ignore this correction, should ignore these short-term swings in the market, should bake away from that short-term trading and maintain a meaningful allocation to equities and ride this out because in the long term again, on going bull market, i think you'll be just fine. >> thon that note, we'll leave there. thank you. still ahead tonight, the new technology for long-haul trucks that could keep us safer on the road. part two of the three-part series, collision course is next.

a lot of buzz on wall street today about the nation's income gap and its impact on the economy. the s&p ratings agency says the widening wealth gap is complicating the rebound from the great recession and making the economy more prone to boom and bust cycles income disparity has also contributed to the s&p cutting its economic growth estimate over the next ten years. >> but despite the uneven

recovery in housing, americans are still buying homes and core logic says the prices rose again in june up nationwide an average of 7.5% but the prices rose by the smallest year over year increase in 20 months. slowed down by a modest number of sales and more homes coming on the market. >> that's my house for sale, no. coach catches a break in earnings that topped estimates and that's where we begin tonight's market focus. the sales better than expected for the first time in four quarters helped by strong demand in international markets, especially china. the cost and expenses increased. shares popped 4% to $35.80 for coach. toyota earnings got a boost while sales in emerging markets were weak. the auto maker cut the forecast for 2014. shares were slightly higher,

11.0 -- $119.03 was the close there. office depot is benefitting from the merge with officemax. earnings and revenue did beat the expected. it finished at $4.94. groupon daily deals website announced a wider loss after an offset. it was at the low range forecast. shares initially plunged after the close. during the regular session, shares were up a fraction at $7.07. zillow, traffic increased and more agents used the home listing service. it also upped the full-year revenue outlook. after the bells, shares were volatile but after the regular session, the stock was down 2.5% to 141.6 -- $141.06.

home care rose, it also upped the earnings guidance for the full year. despite all of that, though, the shares were off just a little at $77.27. and sales at walgreens were higher in july. a strong result from the pharmacy unit helped offset weaker front end traffic and a report walgreens will buy the remaining 55% of alliance boots for nearly $8.5 billion, but it says it will still retain headquarters here in the u.s. the stock fell after that announcement and came back a little, still closing down 4% to $69.12. the u.s. treasury is exploring ways to prevent talk inversions because they can't seem to get anything done to stop the practice. treasury officials are looking

how to enforce and maybe change irs tax codes to prevent u.s. firms from reincorporating overseas to take advantage of lower corporate tax rates there. it seems that long-haul big rig trucks are increasingly on a collision course with drivers. what are truck makers and regulators doing to make highways safer? in the second installment on the safety of the nation's roads, ameamon javers looks at reducin truck-relates accidents and deaths. >> reporter: there is a serious problem on america's highways, and it's only getting worse. nearly 4,000 people are killed in truck accidents and over 100,000 people are injured every single year. a mix of operator error and faulty equipment are the cause but they are working to improve safety on semi trucks. >> the truck will not let me go

faster than him. >> reporter: one of the company's banking on safety is volvo truck. we visited the plant in virginia where things like enhanced cruise control and lane departure warning systems are being installed. we took a ride to see volvo's technology. >> my foot is not on the accelerator. >> reporter: some is setting a cruise speed that does not allow the truck to go faster than the car in front of it. >> you get some slow beeps here from the radar. as you get closer to them, it starts beeper faster and faster. if you get too close, you get the alarm. >> reporter: whenever we did get too close, this would happen. >> the truck is doing all the braking. my leg hasn't moved and cruise, the system will completely stop the truck. >> reporter: this technology very well could have saved dan's family. his wife, mother-in-law and two young sons were killed when a

driver slammed into the back of the family's mini van. >> the impact was so severe that they didn't know what hit them. >> reporter: one of the other features volvo installs in the trucks is intended to help truck drivers, especially those who are fatigued stay in the right lane. if the driver fails to turn on his blinkers and veers off. >> you'll notice a little -- >> reporter: the american trucking association estimates only about 10% of all trucks on the road have some kind of active safety technology, which begs the wquestion, why aren't all trucks required to have it? >> the governments need to speed up the process of evaluating opportunities. >> reporter: safety experts say organizations like the federal motor carrier safety administration are working too slowly but ultimately, the rules should be put in place and

enforced and volvo is not the only company trying to stay unstep ahead of the regulators. mercedes parent company wants driverless trucks on the road by 2025 but skeptics say it will be a long time before we see invasions like fully atomous trucking on the road and now matter how much technology it has, it mitigates the chance of a collision. whether or not you're truly safe on the road really comes down to who is behind the wheel. and tomorrow the final installment of our three-part series takes a look at the trucking companies with safety violations that shut down, only to start up again under a different name. to read more head to our web sierks site, nbr.com. we'll take you to thorou

thoroughbreds and one of the most exclusive auctions in the world. a tough year for target got tougher. the retailer says expenses from the data breach last year will be $150 million. target is lowering the second quarter earnings forecast with promotional mark downs and saw sales up north in canada. that sent shares lower by almost 4.5%. there is a big money battle brewing over some dollar stores.

bloomberg news reporting that dollar general is exploring a bid to buyout rival retailer family dollar but you might recall another competitor, dollar tree is already in talks to acquire family dollar for $8.5 billion. while they evaluate the options, this could mean a bidding war. usa today is paying nearly $2 billion for the rest of cars.com that it doesn't already own. they announced plans to split into two publicly traded companies, one for broadcasting and digital properties and the other for print media. the ceo says it's part of the long-range plan. >> we have been on a transformation journey for the last 2.5 years. we stabilized and revieted the publishing business and doubled the foportfolio, the digital portfolio, so we have great businesses of great scale. >> well, shares nonetheless fell

nearly 1.5% today. t-mobile, the fourth biggest wireless carrier plans to reject a stake offer from francis, a company called iliad. that rejection could come as soon as tomorrow, say reports. t-mobile's parent company sees the offer as too low. did you ever wounder where all these elate racehorses you see in the kentucky derby or preakness come from? many are bought and sold in upstate new york. now in it's 97th year. so what horses are on the action block and who is doing the buying? morgan brenham has that story. >> reporter: every august, billionaire celebrities and royalty from around the world flock to saratoga springs.

here more than $30 million changes hands as the next generation of premiere racehorses is bought and sold. one-year-old thoroughbreds untrained and untested on the track but bred from the winners. >> this is a special sale. it's a select group of yearlings. so this is not an average situation to start with. >> reporter: along line of champ joins have come from this auction from back to manawar, considered the greatest racehorse in u.s. history. buyers examine pedigree and athleticism, choosing a horse they hope can bring not just wins but also return on their investment. >> i'm really careful about my investment but patient and that will pay off on the long term. >> reporter: big money, bigger dreams. >> if you love the beauty of the horse and you love the sport. when they cross the line in front, there is nothing better. >> as the ultimate

discretionary, the horse business and economy are closely tied together. >> the stock market leads the horse business by six to 12 months and when it went down in '08, the horse business fell in '09. right now it's coming back to, almost back to '07 levels. >> reporter: the business is riped with other risks. many horses don't perform according to expectations despite the top genes and top trainers and fall victim to injury. >> it's really a great way to make a million dollars if you start with ten, but now we're making money and i like it better. >> reporter: that's what keeps racing enthusiasts coming back, all of them hoping when the gavel falls at auction, they are taking home the next great racing champion. for "nightly business report", i'm morgan brennan in saratoga springs, new york. finally tonight, the people

have spoken. susie is out rehabbing her foot after surgery and we asked you viewers to choose the color of her cast and you voted for pink. >> pink. >> she listed. you spoke, she listened. a woman of the people always looking stylish, pretty in pink. >> her biggest tour will be color coordinating the out fit. >> the wardrobe with the pink shoes. >> you got to do that. absolutely. >> susie will be back soon, by the way. on that note, that does it for "nightly business report." i'm sue herrera in for susie. >> and i'm tyler mathisen, we'll see you tomorrow.

it was virtually every important service that you use online, but eventually offline, too, are going to get remade and designed from the bottom up with people at their center. people who tour these galleries often say, "wow, i had no idea." many think computing is about scientists, engineers, and mathematicians. >> but if you've ever e-mailed, texted, shopped online or friended someone, you know computing is about you. in this episode of "revolutionaries" you'll meet facebook's founder mark zuckerberg. mark was here recently with npr's guy rozz and david kirkpatrick, author of "the facebook effect."