>> announcer: this is "nightly business report," with tyler mathisen and sue herera. big disappointment. fewer jobs than expected were created last month, raising concerns about the economy and changing the conversation at the fed. reversing course. stocks fell sharply, then staged their biggest upward reversal in four years as investors tried to figure out how to invest in today's market. doing good. meet the entrepreneur who had the bright idea to grow his business while giving back, one pencil at a time. all that and more on "nightly business report" for friday october 2nd. good evening, everyone, and welcome. a setback for the job market and an unusual day for the stock market. today's employment report came as a surprise and not in a good way, stunning both wall street

and main street. the u.s. economy added just 142,000 jobs in september, fewer than forecast. the unemployment rate held steady at 5.1%. and it wasn't just the september number. results for prior months were revised lower, suggesting a down shift in job creation that began this summer. hampton pearson has more on this disappointing labor report. >> reporter: american employers sharply cut back hiring in september, and the government revised job growth downward by 59,000 for july and august. meanwhile, job growth for the last three months is averaging just under 167,000 compared to just under 200,000 per month for all of 2015, much to the surprise of the leading wall street economists. >> if you get the jobs report like this, then people are starting to think, geez, you know, this could actually be a negative quarter. >> it's hard to see anything good in those numbers. >> the economy i think is clearly weaker than any of us would like it to be or thought it would be. >> reporter: headline

unemployment remains at 5.1%, but that's because many americans stopped looking for work and are not counted as unemployed. president obama says economic weakness overseas is weighing on american job growth. >> although the american economy has been chugging along at a steady pace, much of the global economy is softening. we've seen an impact on our exports, which was a major driver of growth for us, particularly at the beginning of the recovery. >> reporter: reduced u.s. exports triggered significant manufacturing job losses last month. oil drillers continued to lose workers due to sharply lower oil prices. earlier this week employers announced plans for nearly 60,000 layoffs in september. at the same time job openings are at an all-time high, 5.8 million. september may be a reminder, it's still an employer's job market and for the moment some are on hold.

>> so job openings look very good but as it turns out the number of hires that employers are actually engaging in doesn't quite match that. so it's one of these sort of risk management things the companies really seem to be doing these days, is seeing a job that's open and then questioning whether they want to follow through with a hire. >> reporter: those with jobs worked fewer hours last month, and average wages are up just over 2% for the last 12 months. but americans are spending more, boosting job growth at the mall and at bars and restaurants. for "nightly business report" i'm hampton pearson in washington. >> that weak jobs report may well change the timing of a possible interest rate hike by the federal reserve, which many thought would happen sometime later this year. steve liesman tells us why that is now in question. >> reporter: it's the second straight jobs report under 200,000 and the first time that's happened since the spring. wall street commentary seems to suggest is this number takes an october rate hike from the

federal reserve off the table and even raises questions about whether the fed will hike at all this year. goldman sachs says we now see a fed rate hike in december az close call. jpmorgan says they're sticking with december but with less conviction. over at action economics they say their best guess is january. some reiterated calls for a rate hike further into 2016. some of the words used, awful, lousy and terrible, must jft adjectives describing the jobs report today. at least the ones we can use on family television. the fed said the labor market was continuing to improve. the question is whether one bad report will change that outlook overall. st. louis fed president jim bullard said the fed should concentrate on cumulative economic progress and not one report. the good news is that markets won't have to fret over rate hikes for the upcoming october meeting if wall street is right about this. the next fed worry moment now becomes november 6. that's when the next jobs report comes and we'll see if the current weakness does a three-peat. for "nightly business report" i'm steve liesman.

and now to our two guests for their analysis of the jobs report. we've brought back moody's analytics chief economist mark zandi. he was with us last night. who's very xwrup beat about the jobs picture. and lindsay piegsas is with us. chief economist at stiff'll fixed income and is a bit more bearish on her views on the labor market. welcome to you both. it's a plashz to have you here. mark, i'll start with you because last night you were looking for 200,000 plus and very upbeat on the jobs market but not only did we miss on that number but we had downward revisions in previous reports. does that change your opinion of the market? >> no. i do think the damage from the weak global economy, stronger dollar, lower oil prices and just the volatility is doing more damage to the labor market than i anticipated but i view all those things as more or less temporary and as we make our way to the end of the year into next i think the underlying growth rate in jobs will reappear around 200 k. that's abstracting from the

vagaries of the data that's roughly where they are. so my views have not changed as a result of this. i'm disappointed but i don't think this changes the picture. >> lindsay, respond there to mr. zandi. do you see it that way or do you fear this could be the start of something not so good? >> well, it was certainly a disappointing report but i would actually argue this has been a declining trend in the rate of hiring for quite some time. remember last year we were hiring ate pace well over 300,000. that slowed to 250 and now with this report coupled with the downward revision to the previous month we're now talking about an average of 167,000 -- >> you what does that mean for economic growth and where you see it in this third quarter -- well, the third quarter that just ended and in the fourth? >> well, a slowdown in hiring typically translates into a slowdown in economic activity. so for the second half of the year we're looking for about 1 1/2% to 2% gdp. still positive but certainly not the 3%, 4% gdp you would expect from an economy after six years of zero interest rate policy. >> you know, mark, we just ran that piece by steve liesman

saying that now there are some who are questioning wrt downward revisions in previous months whether or not the fed will actually move this year. lindsay's been on the record for several years now saying they're not going to move till 2016. does it change your opinion? >> no. i think december is still the most likely, though into 2016 is certainly plausible. i do think a necessary condition for them to raise rates is for my forecast of 200,000 jobs per month to be accurate and true and that shines through by december. it also is prez kated on the expectation that the volatility in financial markets abates and we have more stable conditions. so things have to come together. i think they will. so i think the most likely scenario is december. but i don't think i'd argue too strongly if it were january or sometime early in 2016. >> lindsay, soggy job numbers for september, downward revisions for august and july. the pace is clearly slowing but what happens in october, november, december as so many

companies add seasonal workers, whether it's ups or walmart or target? does that in and of itself help hiring? >> well, remember, we account for that with seasonal adjustments. so that's not going to play a major role here. and actually if you want to look at the pace of seasonal hiring over the past several years it's now being spread out into the third quarter as well. so actually, those seasonal adjustments may serve to undermine some of the more positive growth that we would see in the final quarter of the year. >> when you look at the global environme environment, how healthy do you think it is? we've been a shining star of the global environment but we also do not live in isolation anymore as an economy. >> exactly. >> so when you look globally, how do things look to you? >> well, the fed has been watching the international environment, and that has added another layer of concern, of potential contagion from the slowdown abroad. they're concerned about international volatility in equity markets. they're concerned about declining demand in commodity prices, essentially allowing us

to import deflation, and of course a rapidly rising u.s. dollar makes u.s.-made goods relatively more expensive putting downward pressure on manufacturing and jobs creation here at home. so when we take a step back and we look at that very disappointing outlook, that sluggish activity level on the international plane, that's going to have compounding negative impacts here in the u.s. >> all right. thank you both very much. have a great weekend, lindsey piegza and mark zandi with moody's analytics. >> biggest upward reversal for stocks in four years. equities plunged at the open along with bond yields on that weak jobs report, only to change court and end the day higher. much higher. the dow jones industrial average up 200 points after being down as many as 258. that's a 450-plus-point move. the nasdaq rose 80. the s&p 500 tacked on 27. today's rally helped the three major indexes finish higher for the weak, as you see right there. part of the reason for the stock

market reversal was a rise in domestic crude prices, which today settled up nearly 2%. anthe yield on the ten-year note fell below 2%, tumbling as low as 1.9% this morning. later in the program our market monitor will help you figure out how to invest in this market, and he'll offer three picks. >> and with the job report coming in weak, many are looking to the transport sector for clues about the health of the economy. because when the economy does well, people and businesses tend to ship more things. and when it doesn't the industry slows. morgan brennan takes a look at the message this sector is sending. >> reporter: a disappointing jobs report from the labor department may be confirming what the transportation sector has been indicating for some time. u.s. economic growth is showing signs of slowing down. transports have been long considered a gauge of economic health. since so many goods for so many industries must come in contact with a train, ship, or truck. analysts say the sector has been telling a tough story all year.

>> it was certainly the first industrial-led recovery we've had since 1961 in this economy from '09 through '14. but today we're seeing what appears to be the first industrial-led recession in a long time. >> the prolonged downturn in the commodity complex has been weighing on stocks exposed to crude oil and other materials. rain car loadings for u.n. pacific, norfolk southern, csx, kansas city and berkshire hathaway's dnsf continue to disappoint thanks to coal, petroleum products and metal. last week commodity carloads were down 6%, marking the 29th straight week of declines. the commodity collapse and its effects on the industrial economy have also weighed on the less than truckload fleets that truck goods for multiple customers with one vehicle. ltl carriers deliver many industrial goods and raw materials. one reason fedex, which has a large ltl business, recently trimmed its earnings forecast. but another more worrisome trend

may be emerging. data for trucking fleets that largely haul goods for consumers are starting to disappoint, suggesting that the part of the economy that has been holding up, the consumer economy, may be beginning to wane. >> from the beginning of the year we were also looking for the consumer to take that reduced cost of the commute, reduced cost of heating and cooling their house, and spend that money elsewhere. we so far just have not seen that. it's been worrisome, troublesome, and as truck tonnage is continuing to tell us, the consumer's just not spending. >> reporter: one area that's remained a bright spot is inbound container floats, or wares coming into the country through the ports. much of it in anticipation of the holidays. but as other transport data weakens and as the labor market shows signs of cooling, the question now, will the peak holiday season be as strong as everyone has been hoping? for "nightly business report" i'm morgan brennan. >> still ahead, the winds of change. one industry where demand for workers is on the rise. running counter to today's

dismal jobs report. retail brokerage firm scottrade suffered a data breach. the discount broker says it believes its systems were attacked between late 2013 and early 2014. the hackers targeted client names and addresses. scottrade says it is notifying 4.6 million customers and offering them identity protection services. employers may have added only 142,000 jobs last month, but there are some industries where jobs are on the rise no, matter which way the economic winds blow.

mary thompson reports on the need for wind turbine workers from sweetwater, texas in our latest installment of "where the jobs are." >> reporter: sweetwater made its name as a railroad hub but it's banking on a future in wind. the more than 1,300 turbines dotting its skies mean plenty of work for turbine servicers like shermco industries. if can find the workers. >> we have the jobs, but we can't find the people. >> reporter: the bureau of labor statistics says jobs for wind technicians should grow an above-average 24% by 2022. driving the increase, a rise in the number of turbines being installed as a cost of wind-generated electricity has dropped in half over the last five years. >> when our students graduate, i would say almost about 98% of them place. >> the heat energy technology program at texas state technical college. he works with the industry to ensure the two-year program produces workers with the right

skills. >> they're looking for guys that can read skeemt chematics, mech and electrical skills. >> those skills needed for years to come. wind-generated electricity acts for just under 5% of the u.s. total now, but is seen more than doubling to 10% by 2020. >> it's a young industry and it's something that's going to grow exponentially over the next 10 or 15 years. >> reporter: 33-year-old harold pergo left pennsylvania for texas and a career in retailing so he could study to be a wind tech. along with plenty of work, being a wind tech pays well too, especially in markets like texas, where shermco's ceo ron woodup says competition for talent is stiff. >> you're coming in as entry-level job probably 40,000, 45,000 a year. then there's an overtime element. so you can very quickly get up to 60,000 or 80,000 a year. and then in a few years it's not uncommon to get to a six figures pretty quickly in this field. >> the steadiness of the work and pay a welcome change for

34-year-old jeremy brackenridge. >> i'm making about 10% more than i was. >> reporter: he's held a number of jobs, most recently in oil and gas. laid off there, he's now training in-house at shermco to become a technician. energized by the possibility of a future in wind. in sweetwater, texas i'm mary thompson for "nightly business report." >> and to learn more about the demand for wind turbine workers read mary's story on our website at nbr.com. we begin tonight's market focus with reports that sprint is planning major cost cuts according to the "wall street journal." the wireless carrier could save $2.5 billion in costs. the cost cuts will result in some job reductions. the company currently employs more than 31,000 people. shares rose almost 5% on that news to $4.25. the snack maker mondolese is exploring a sale of several of its europe urbane businesses. that's according to a reuters report. the company's cheese and grocery

business in europe could fetch around $3 billion in a sale. sales rose to 43.56. novocure is make its wall street debut today. the company which makes a device to treat a form of brain cancer priced its offering below the expected range and still shaw its shares fall in their first day of trading. despite the down day, though, the ceo is confident in the decision to go public. >> we want to be completely ready to bring this therapy to patients not only in the u.s. but we've just started commercialization in europe and we've just received our first approval in japan. so again, markets will be ch choppy. they'll go up and down but if we take care of the cancer patients, stockholders will be in good shape in the long term. >> shares were off almost 17% to $18.28. united airlines saw its shares fall as the union for maintenance technicians says the airline is dragging its feet in stalled talks. the union has been in

negotiations with the carrier since november of 2012. the stock was off more than 2% to 51.76. and now to our market monitor, who doesn't believe the market is out of the woods just yet. so he's being so he says selective and cautious with his buying. he's jeff sott, chief investment strategist at raymond james. last time he was on he recommended dexcom up 128% and johnson & johnson, which is down 5%. welcome. i didn't know it was that long. do you still like both of those companies, dexcom and j&j? >> i do. i think that for conservative folks johnson & johnson has a favorable rating from our analysts and it has a night portfolio of businesses. and dexcom makes the best wireless glucose monitoring system on the planet. >> let's get to some of your picks. i hope i'm pronouncing this right. stonemoore partners lp. >> yeah. bottoms tend to be a process not

an event. we had an event last fall on october 15th where you had a v-shaped bottom. but most of the time you come down into a capitulation low and then it takes six to eight weeks to form a bottom. so we're not sure the bottom has been made but if we are making a bottom i'm going to be conservative with the yield name stonemoore is like a desk stock. cemeteries. decent yield to it. strong buy rating on it. >> let's move on to genesis energy lp. tell me what they do and why you like them. >> they are a mid-stream master limited partnership. so they're basically a toll taker. they don't have great price sensitivity to crude oil. the crude oil's got to go through the pipes. it's got to be stored somewhere. grant sims is the ceo. he's arguably the best ceo in the space. we think they're going to continue to increase their distribution and our analysts like that one as well. >> and flaherty & cromein preferred securities. >> don cromein is as bah arguably the best portfolio

manager on the planet. he ran for charlie munger and warren buffett in the preferred space. two closed end funds that are trading at a discount to their net asset values with really decent yields. >> let's turn back to the market more broadly after today's jobs report. are you optimistic the market could end the year higher even though in this most immediate term you describe yourself as selective and cautious? what do you think? >> well, our models turned cautious in the first part of july. we said the markets are going into a period of contraction. i didn't think it would be this deep. i do think we've made a capitulation low on the 24th and 25th of august. so if i had to bet i would bet stocks are higher by year end rather than lower. >> and what does the fed do and when? >> you know, i think that when it does it is not important. i think it's the trajectory and the pace of rate increases. my model has always called for a november inkracrease even thoug there's no fomc meeting. that's certainly an out of consensus call. >> it sure is.

we'll have to have you back in november, jeff. we don't want it to be this long again. thanks for joining us. jeff sott with raymond james. coming up, pens, papers and paper clips. meet the entrepreneur who's make back to school cool and giving back in the process. this month's bright idea is next. ♪ here is what to watch next week. on thursday the federal open market committee will publish the minutes of its september policy meeting, and wall street will be watching. on the data front a report on international trade, consumer credit, among others, and alcoa

will report its earnings, marking the unofficial start to the earnings season. and that is what to watch next week. all right. we talk about it every year. parents can spend $200 or more per child on school supplies. those who can afford supplies, that is. teachers also spend money out of their own pockets. $500 on average. that's why one company got the bright idea to help families get some newer, funkier school supplies into the hands of young students who need them. >> good morning, everybody! >> good morning! >> reporter: at the camino nuevo charter academy in a part of los angeles where the median income is less than $28,000 a year, ito lessler's school supplies are a welcome gift. leffler got the idea to help after shopping with his own kids back in 2013. >> they basically ignored the school supplies aisle. if i'm not excited about what's in the aisle and my kids aren't excited about what's in the aisle, that's low-hanging fruit.

so we decided to funk it up a little bit. >> reporter: his company, youby, didn't invent finders and pencil cases. it redesigned them. bright colors, tactile textures, jumbos and minis. the products are fun. but youby is serious about its mission. for every item it selds it donates one. for a while leffler could have used that kind of help when he was growing up in australia. >> i know what it's like for my mother as a schoolteacher to pull money out of her own pocket to buy supplies. >> reporter: his dad's real estate business had failed back in the 1990s. things are just fine now, and leffler has started several companies. his yes 2 is a hit in the all-natural beauty products space, which helped get him a meeting with a contact at tar t target. >> i said to her would you like to turn around and see the product? and she looked me straight in the say and say i don't have to. we're going to impact millions of kids. let's do this.

and boom. >> boom is right. yoobi launched in june 2014 and did $20 million in sales in a year. its donations have impacted more than a million students. still, some wonder how effective the buy one give one model can be. >> one of the big criticisms of the model is that it doesn't address the root causes of the social issue. >> reporter: cornell university's chris marques has written about how companies like tom's shoes and warby parker with its eyewear have addressed symptoms without actually solving any problems. raising awareness is a plus, but to be successful the cause has to resonate with consumers and the price point has to make sense for the company. >> there's a lot of research that shows that younger consumers actually want to give back, they want to have some sort of social impact, so i think actually this market will continue to grow. >> the first thing we need to do is make her a yoobi -- >> reporter: yoobi also helps

teachers like camino nuevo's maria cortez, who spends a lot of her own money on her students. >> over 1,000 a year. for them what it means is they are valued. right? like our classroom is valued, our school is valued, their work is valued. and i tell them they are the leaders of the future. and yoobi is really supporting that for our children. >> reporter: after all, it's keachers like cortez and ido leffler's mom who can inspire students to put themselves into the equation when it comes to solving the products of the future. >> it doesn't matter what widget you're selling. if you've got a cause that everybody is fully committed to, then you're able to do things that really translate to magic. yoobi even caught the nairn attention of the entertainer usher who chipped in and helped design a new line this year and also participated in one of yoobi's giveaway events at a different school in los angeles back in may. more and more companies and more

and more customers want their purchase to be linked to a purpose. >> to a purpose. absolutely. well, good for him. because you know, the start of the new school year should be one that's positive for kids i think. that helps. that does it for "nightly business report" for tonight. i'm sue herera. thanks for joining us. >> and thanks for me as well. have a great weekend, everybody. we will hope to see you right back here on monday. ♪ ♪

you bring me to the nicest places. if this case is as open and shut as strickland thinks it is, hopefully we won't be here too long. so, this bloke davies wants to make a confession 25 years after the event. have we spoken to his mental health officer? he does have a link to the missing boy. he was a friend of the family. so, what? his conscience got the better of him? maybe he found religion when he was inside. yeah, there's got to be another reason for all this. what? ( rings doorbell ) oi, pedo! come out your house, man. what you hiding behind your door for? for a start, the local wildlife seems-- oi! ha ha! let's get out of here. wait here. ( tires screech ) are you detective superintendent pullman? she'll be here in a moment. she's just doing a bit of community policing.