this is "nightly business report" with tyler mathi sue herera. home sweet home. the overall face of new home sales remains near a six year high despite a slight drop in january. but it's home improvement projects that are really picking up. target's transformation. are consumers responw changes made by the ceo? playing politics that's what some house lawmakers accuse fed chair janet yellin today. all that and more for "nightly report", wednesday, february 25th. good evening, everyone. welcome. the dow jones industrial average eked out another record close but it was housing and how hope may spring eternal for the housing market that got everybody's attention.

today, there were some positive signs for the sector which has lagged the overall economy since hitting a speed bump more than a year ago. single family home fell only slightly in january despite all that snow in the northeast. while supply which has been tight, rose to its highest level since 2010. the pace for sales for december was also revised higher. tight inventories and a lack of wage growth had been holding housing back but now the labor market seems to be gaining steam and home builders gain more traffic. not just home builders but home improvement retailers. today, lowe's reported better than expected fourth quarter results driven by homeowners taking on big and not so big renovation projects. shares did fall a fraction after the company expressed concern about rising interest rates, potentially impacting prose home buyers. still, the company does expect existing homeowners to continue

to invest in projects anhouses. diana olick now on what's behind the surge in remodelling. >> reporter: rising home give more confidence to invest in their properties. >> as soon as we see the housing market recover, people get confident. not only they tackle the renovations they want to but address the maintenance it needs as well. >> reporter: project large and small small. w more projects more proposals out than ever before. >> reporter: matt is seeing a steady business ahead but smaller growth in less expensive homes. >> i think the reason why we're seeing the increase in the lower end is because people are feeling more confident in the economy, more confident in their spending ability, more confident in making investments in their homes. >> reporter: while full recovery and residential construction is

many years away the home improvement industry could post record level spending in 2015 according to harvard's joint center for housing. remodelling building permits rose 6% in january month to month according to build facts. why? people who didn't move because of the housing bust are now improving their current homes, maybe even preparing them to sell. some are doing much needed maintenance they made during the penny pinching recession and new state for upgrade. while kitchen remodels are the most popular and return the best value, today's trends are driven by those who can't afford to move. growing families, add another bedroom upstairs and baby boomers doing the same thing so they can age in place. >> that's a big change that i see in the market in the last two to three years. >> reporter: given an ever pricier market one likely to grow even more.

for "nightly business report," i'm diana olick in washington. >> today's choppy trading session was just enough to help the blue chip average finish at an all-time high. by the close, the dow jones industrial average closed at a new record of 18,224. a gain of 15 points. the nasdaq fell less than 1 point thereby breaking the winning streak. the s&p 500 also off by a point. and the yield on the ten year it stayed below 2%. federal reserve chair janet yellin back on capitol hill for her semi-annual report to congress on the economy. but today's hearing in front of a house panel was much more contentious than yesterday's senate appearance and much more political. lawmakers accused yellin of meeting with the white house more often than with congress and with democrats, more often than with republicans. >> as far as meeting with outside liberal organizations, i wonder whether you can agree today that you will meet with folks from the other side on the specter and meet with some of

them who have a different view on this. >> i'm sure we meet with a wide range of groups. i think it is a complete mischaracterization of our meeting schedules and my meetings are entirely public. my schedule is completely in the public domain. >> that's where i'm actually taking this from. this was handed to me. this much of it is in public domains. would you make available the transcripts of the meetings that you have? you didn't answer that question to the chair. would you make those summaries? >> these were private one on one meetings. if i had breakfast with you, i would not make a transcript of what we discussed. >> lawmakers also questioned the timing of her speech on income inequality which was given in the midst of last fall's congressional campaigns. tensions were also high at another capitol hill hearing. this one on the internet and how it should be regulated. tomorrow the federal

communication commission will vote on new and very controversial rules that propose to regulate broadband pretty much like a utility. and today, some of those who oppose it got one more chance to make their opinions heard. julia boorstin has more. >> reporter: the federal communications commission is expected to approve 3 to 2 net neutrality rules and can't charge for prioritization. the new rules would regulate the internet as a public utility. while internet companies from x to facebook and providers including comcast and verizon largely agree on the principles they disagree on regulating the internet under title 2 regulations. the same way phone companies are regulated. internet company said the rules protect consumers. internet providers say it raises the risk of government overreach. >> you have the companies like

verizon and at&t and comcast who don't oppose the net neutrality rules but the framework in order to get there imposes all of these burdensome regulations. >> reporter: comes on the heels of a committee hearing where they oppose net neutrality rules. >> what they'll vote on tomorrow is net nonsense. >> reporter: said it will lead to years of uncertainty for consumers. congressional republicans who delay the vote say legislation is the best solution. if the vote goes as expected this battle is far from over. mark cuban is an outspoken proponent. >> i think net neutrality is the dumbest stuff ever. it's not a technical argument. it's not a business argument. it's purely and simply a demonization of a couple of big companies. >> reporter: they say lawsuits are on the horizon.

>> the key question is part of this collateral damage conversation, is this really a foot in the door towards price regulation of the broadband market? >> reporter: the sec said there's no plans to regulate pricing. i'm jewel yuleulia los angeles. new to tell you in the standoff. democrats agreed to a proposal by mitch mcconnell to vote on two bills. one will fund the agency and another on the president's executive order on immigration, but at this time it is still unclear how the house will respond. to earnings now and target which reported its best sales growth in about three years today. sales rose 4% ahead of projections and profits beat the forecast. rose modestly sitting shy of a 52 week high. courtney reagan looked at the big changes for the ceo and

what's ahead for target's transformation. >> reporter: so far, so good. in the second full quarter as target's ceo, ryan cornell led the retailer to earnings and sales even above the company's updated forecast. comparable sales turning in the strongest result in 11 quarters. thanks in part to the redemption of gift cards purchased over the black friday weekend. >> when we think about this connection of stores and digital, the important point is it's not either/or. it's an and. >> reporter: included exiting target canada after opening stores less than two years ago and this week cutting the free shipping threshold in half to $25. in a cnbc exclusive, target's chief financial officer, josh mul mul mullygan said it's more of an investment because target shoppers that buy both online and in store are more valuable

than consumers using only one shopping channel. >> automatically, we get more sales because they're shopping online but actually increase engagement in the store as well. so we see a significant increase in both sales and gross margin dollars or profitability. >> reporter: there are more subtle initiatives cornell works on to bring in shoppers and enhance their loyalty to the retailer. particularly moms. >> every time i talk to target moms they have stories about coming to our stores when they had their first child, memories they have about shopping. we want to make sure we reinforce that. it's something we're going to be famous for. >> reporter: if they can make shopping a habit for growing my lenal mom generation suggest target's earnings will be a positive beneficiary. target is the strongest brand among mothers with young children. a grou shops stores frequently and is less likely to substitute shopping at target with online options. but the initiatives aren't free.

there's a cost associated with keeping digital strategies, excel compelling merchandi and in store moving forward but don't know what the cost will be. analysts hope to know more when cornell speaks next week at investor day in new york city. for "nightly business report," i'm courtney reagan. the owner of t.j. maxx is following walmart's lead raising wages for a half million of its employees. in its fourth quarter, the parent of marshall's and home goods said part-time earn at least $9 an hour starting in june. workers with the company for six months or more earn $10 an hour. overall results topped estimates and will hike dividend to 21 cents a share. still ahead, the big problems plaguing our nation's pensions both private as well as.

the three largest tobacco companies have agreed to pend the cases. related to a 1994 suit. reynolds will pay $42 million. big technology may feel the fallout from revelations of western cyber surveillance this according to a reuters report. now, the government of china has now dropped some big name tech brands like cisco, apple, and intel from its approved list of state purchasers. eamon javers has been covering this story since we first learned of the surveillance program and the global reaction.

eamon, did edward snowden, if anything, give china an excuse stop using american companies? >> reporter: absolutely. there's reasons why china might want to stop using american companies and push some of the business to its own domestic industry but the snowden disclosures give them a good reason to do that from china's perspective. from beijing, why import all the gear that might be contaminated with nsa hardware or agreements between the nsa. if you can build it at home and buy at home makes a lot more sense for the chinese. american companies have a lot to lose in all of this. >> absolutely. it's going to have a big impact on the bottom line but it seems if a lot of it goes to what you were just mentioning and that is over the past few years, china has really ramped up its focus on creating its own technology companies. >> reporter: yeah. that's right. and don't forget sue, this concern goes both ways. american government agencies have had concerns about wild way

and lenovo. they've been reluctant to use some of those machines in the u.s. government and high-tech, high security industries for the same reasons the chinese may be resisting american equipment. so you have this sort of standoff but more american companies are selling equipment in china than chinese companies are selling equipment here at the high end. so that means that those american companies have a lot to lose here and a lot of that plays into this tension that yo now seeing between the silicon valley companies and the government in the wake of the snowden disclosures. a bit of a frosty relationship with business being lost. >> eamon javers thank you. in washington. chesapeake is the latest energy company to cut back because of slumping crude prices. that's where we begin tonight's market focus. reported lower than expected earnings and would cut the rig count. the stock today, one of the worst performers in the s&p 500. down 9.5% to 17.98.

soda stream quarterly profit topping estimates, lowering expenses. offset a drop in revenue but investors couldn't overlook that. sales drop for at home in the u.s. also a weakening euro to dollar exchange rate hurt revenues. sizzled down 9% to $17.25. shares of lumber liquidators after the company may face criminal charges from the department of justice for allegedly importing illegally harvested wood. the chain also said it will be the subject of a negative profile on an upcoming evidence of cbs's "60 minutes." adding to the bad news the hardwood flooring makers missed on both top and bottom lines. not a good day for lumber liquidators. look down there. 26% of 50. 63. american express said it will hike interest rates on some cars by average of 2.5 percentage points.

not clear how many customers will be affected by the move but some reports say more than a million card holders will see rates rise. rose to 82.17 drr$82.17. southwest airlines agreed with federal officials to allow the airliner to keep flying its jets even after missing a mandatory inspection deadline. they allow to fly for five days while it's completed. one fifth of the airline's fleet in question. shares of southwest off almost 3% to $44.12. >> as the nasdaq inches closer to 5,000, it's 15 years since the index hit the lofty round number. while many firms that fueled its rise in 2000 are long gone others survived. a few with the same chief executives in place. mary thompson looks now at the ceo survivors.

>> reporter: long serving ceos have seen the index hit before. starbucks howard schultz, cisco's john chambers and lorkl. still at the controls today. >> the reason they've lasted is because they've learned to adapt. >> reporter: they aren't afraid and innovators like besos. and change the way we think about coffee. ellis changed corporations by software bundling it rather than selling it piecemeal. >> is leadership important? >> i think it's really important. >> reporter: these ceos rare not only because of long-term success but long terms they've served their companies. the conference takes the average ten year at 9.7 years. these four have run their companies for 20 years or more. in part because they understand something very important according to professor bill

cleffer. >> ceos not only look to maintain current portfolio of offerings but at the same time look to reinvent what it is they're doing because of what the future holds for them but their customers need. >> reporter: a serial entrepreneur besos is not afraid even with a relentless focus on creating customers happy. >> we've created a lot of talent by thinking about the future putting the customer first. trying to invent and being patient. >> reporter: that have seen them rise since 2000. like besos, schultz focuses on the customer and competition. during the 8 year break as ceo, starbucks faltered. he clod stores rehired from o outside and trained baristas.

it's a gain in the stock since the crash. >> i got the company my father never got the chance to work for. >> reporter: having stepped aside as ceo. through acquisitions he transferred from a database firm to a software giant and remains key strategic. it's been muted by the rapidly changing world of tech made for choppy waters for cisco in chambers too. c cisco's stock is down. still, they survived a crash and a space where past rivals now gone. for "nightly business report," i'm mary thompson in new york. to pensions now. public and private pensions have not gone away of course but with people living longer both experience funding short falls. joshua balm is here to talk about the issue and how it might impact you. former director of the pension benefit guarantee corporation

and now a guest scholar of economic studies at the brookings institute. welcome, nice to have you here joshua. >> nice to be here. >> it's kind of a good news/bad news story as we said. we're all living longer but we might outlive the funds. if we do indeed are lucky enough to have a pension. >> r that's right. but i think the most important thing to remember is we are livering li longer. the challenge is our retirement programs haven't kept up. so companies sponsored pensions didn't set up aside to take this into account. for those of us who have 401(k)s or iras or bank accounts that responsibility is ours. and most of us have not set aside that. that's the bad news. the good news is that this is not a problem which you have to

solve in a day. it wasn't created in a day and won't be solved. if we're smart, consistent, don't panic, and set aside more for the future, retirees have a future. >>what's going to happen if states fail over time to put the required amounts of money in? governor christie widely criticized for not living up to a pledge he apparently made some years ago to put an end and in front of the legislature said this time i really mean it. >> one of the most important things to understand is that cases like governor christie and new jersey are the exception. the vast majority of pension plans put the money aside they were supposed to.

it is the case they set aside if the stock market would continue to rise and as a result they are underunderfunded. a couple of states did more thon that. they required the contributions and behind two 8 balls. what's important is that they are the exception. and two is if they are serious, if they are consistent if they start correcting it now, things will end up just fine. >> but how much of this depends on the market continuing to perform well? nobody expected 2008 to be as bad as it was or to last as long it did. >> i've had a couple of colleagues who are trying to that. there's no one who can tell you the answer where the stock

market can be. if they did, they wouldn't be spending time on the "nightly business report," but investing on their open account. but using relatively conservative almosts of what marmts would make over the course of a general recession. i have a colleague at the brookings institution that looked at retiree health not pensions but health on which there was a short fall and it's a very large amount of money with the pept prl. she said how much would it take to solve the retiree health problem? less than a 1% increase in revenues that's taxes, or a less than 1% increase in costs would be enough to solve the retiree health problem. >> wow, okay. joshua on that note we have to leave it there. thank you so much.

fascinating. joshua balm with the brookings institute. ty? going with the train. manufacture hunger from more protein. coming from the most unusual source of protein. americans are on a protein adding craze, throwing powder into smoothies and using it on toppings for food. as jane wells tells us, one grain in high demand is packing in the protein. >> reporter: derek personifies everything in modern fitness. doespaleo without the meat. goes to rice. rice is the new heatmeat? >> i look and feel better.

recovery is the same. >> reporter:s this is rice? >> yes. >> reporter: cashing on america's hunger for more protein in the duet. writing protein a $12 billion global market in two years and wants to carve out a nearby, how to extract a protein from the rice. . >> is this more expensive? >> less expensive and hypoallergenic gluten free and vegan. >> reporter: sold from whole foods to the vitamin bar. and rice protein products now fastest growing line. >> the organic sales since 2011 have increased 204% and actually last year the sales increased

72%. >> reporter: rice protein doesn't cost that much because axiom uses unsellable bits of rice source material. estimates at $100 million but the setting showing no difference in muscle recovery because using whey and muscle it's from the crowd to the health club crowd. for "nightly business report," jane wells, los angeles. that's it for "nightly business report." i'm sue herera. >> and i'm tyler mathisen. thanks for joining us. we'll see you back here tomorrow.

laura: it was said of reverend marley that he had once given a local woman his own shoes so that she might go to church. ( indistinct ) the locals had a saying about our curate which, strange as it may sound, they truly meant. they said that benedict marley was too good for this world. this might've always remained so but when a strange menacing spirit found its way into our little corner of the world it was as though a shadow fell on a garden a curse colored the minds of people