this is "nightly business report" with tyler mathisen and soucie. >> stocks out of the gate. first day of trading, 2015. didn't last. by the closing bell s&p 500 did something it hasn't done since 2008. direct response president obama authorizes additional sanctions against north korea in retaliation for the cyber attack against sony pictures. and in the spotlight, five ceos who have their work cut out for them in 2015. all that and more tonight on "nightly business report" for this friday january the 2nd. and i wish you a good evening. happy new year. i'm bill griffeth in tonight for tyler mathisen.

after a strong 2015 for stocks began with a whimper after ended first trading day of the year. mixed and little change. after an early rally was wiped out by data showing in manufacturing and construction. first closing bell of the year with dow up triple digits on the opening but ended about 10 points higher when all was said and done. nasdaq down by 9 poibts and s&p lower by a fraction of a point, first time since 2008 the s&p 500 fell on the first day of the new year and the last day of the prior year. meanwhile, oil prices continue to slide lower. domestic crude fell 58 cents to close $52.69 a barrel. brent north c and london closing at $56.42. by the way, the u.s. dollar index was nearly a full percentage point higher today, that is now at an 11.5 year

high. more on today's disappointing economic data that shows the u.s. manufacturing sector pulled back last month to the slowest pace in six months. construction spending dipped in november on fewer new projects from the federal government that pushed the yield on the benchmark treasury note. fell back to 2.1% today. but strong economic data was a big part of the solid gains we saw in the markets in 2015. the big question now is for the new year will the economy and the markets continue to grow? steve liesman takes a look tonight. >> reporter: shoumd find the missing link. surge market and runaway, second quarter of 2014 the best six months of growth in 11 years. but what's been painfully absent is improving fortunes for average americans. many economists think that could

change in 2015. >> the wages are going up 2% i think, next year they go up more like 2.5% heading up to 3% in 2016. >> reporter: add to that plunging gasoline prices and a 30% decline in natural gas costs and consumers should have more money in their pockets this year. filling in that missing ingredient of the recovery. and there could be more firsts this year. >> i think sometime around the middle of this year the federal reserve will start rising rates but more important than that the pace is going to be pretty gradual. >> reporter: it would be the first rate hike since 2006 and forecasts call for gradual hikes by the central bank. one reason rates fell last year was weakness in foreign economies, especially europe and asia. so far, the u.s. recovery has weathered that weakness but it remains the major threat for 2015. another is that lower oil prices drag down the u.s. economy because the nation has become such a significant producer in

the past several years. but most economists still see it as a net positive for the u.s. and it appears the u.s. exporters are challenged by a stronger dollar to make goods more expensive overseas. the fundamentals line up for modestly growing with 3%. a year average americans should enjoy the fruits of the expansion than they have so far. for "nightly business report," i'm steve liesman. our next guest says there are reasons to be optimistic about the economy in 2015 and for the stock market. though it could get rocky at times. jeff sod is the chief investment strategist at raymond james. happy new year. >> happy new year bill. >> thank you. we've had six consecutive year of gains. best up 26% and worst, up 5%. where do you see us falling in 2015? >> i think you're going to start the year off on the downside here. the timing models that predicted last year pretty darn well that

are calling for rockiness in january and into february. but overall, stim've stick with the same forecast as last year in 2014. up between 10% and 12% this year. >> what will drive that? i mean this is a period of time we know oil prices are already low. they're expected to go higher. interest rates are low. they're expected to go higher. will that put a crimp on or a cap, if you will on the economic data or will it help it? >> i think it will help it. i think janette yellin got it right. i think economy reached the scape philosophy. the economic recovery or business cycle or expansion era, you tend to get a mid cycle slowdown. what is interesting about this is the economy appears to be accelerating when normally you would get some kind of slowdown. so i'm pretty optimistic on the economy and the american consumer. >> john growth is better than it has been. we've had a very good number the last couple of months. wage growth we're still waiting

on. it's starting to show signs of gain but you think we'll see an acceleration there. why? >> i do. because i think the economist that steve liesman interviewed had it right. you're getting a tightening in the workforce in terms of the slack in the workforce. you did see wages pick up modestly this year. we think that's going to accelerate next year to what the economist was talking about, maybe 2.5% to 3% going into 2016. the drop in the price of gasoline according to ed high man, is the amount to putting $200 billion in increase purchasing power in the hands of american consumers, especially impactful at the lower end of the wage scale. so the american consumer looks in better shape than they have in a number of years. >> let's make this meaningful to investors. what sectors, you're the investment strategist where would you put money to work in 2015? >> i've seen this act before. i think we're in a secular bull market. we're almost six years into it. they tend to last about 15 years: so i think you've got

another 8 to 10 years in this one. and in this stage of the market cycle, you're at the stage where i think just about everything works. >> well this past year utilities were the best performing sector. health care not far behind it. energy the worst performing sector. so where are you going to continue those trends you see or put your money to work somewhere else? >> i think pick up in the capital expenditure cycle. companies have been shy on spending on cap x. there's a lot of equipment to be repliesed. i think technology benefits that. i would overweight technology and after that performance of utilities, i would underweight utilities. >> what about energy? >> i think energy is a buy. and we talked about this saudi. for political reasons. my energy team i think one of the best in the country, looking

for a bottoming in the energy cycle and energy stocks look plain cheap. good things happen to cheap stocks. >> jeff sod, happy new year and have a great weekend. >> right back at you. >> thank you very much. after recalling 84 million vehicles in 2014, general motors kicked off this new year with what else another recall. this time it's for nearly 90,000 pick-ups and suvs dating back to the model year twechb2007. you wonder when it's going to end. for the em battled ceo, the new year brings a change and host of new challenges. this year a number of high profile ceos are making big changes to their companies. changes that they hope will keep them squarely in the investor spotlight. mary thompson has more. >> reporter: the party is over.

now it's back to work. for ceos like dick costlo will need to work fast. >> it's popular and an element of pressure but to execute through the year i think it will be status quo in terms of management. >> reporter: costlo and several ceos need to recharge their company. twitter stock fell 4% last year giving costlo to hold on to key managers. his strategy for the new year strengthen twitter's core audience make the service easier to use and gin up new services to attract new users. mcdonald's unveiled a new menu this month part of ceo don thompson's plan to jump start the sales in the u.s. monthly sales a key barometer, won't take long to know if this is the right recipe for a turnaround. yahoo stock up over 20% in the past year but more to do with the company's multibillion dollar stake and the chinese internet giant, ali ba baa, than

meyers' leadership. >> i think the problem is she has too much money and has to spend some. the investors will say, just give us the cash. >> reporter: myer plans to give half of the proceeds from the ali ba baa stake to shareholders. what does she do with the rest of the money? after for sales and a weak one for profits, coke plans to cut costs and shed its bottling business. is ceo's plan enough and can he execute it fast enough to keep disgruntled investors at bay? with ibm, the worst performing dow stock for the past two years, ceo jinny ra met tee needs to reverse the trend. >> i think rametti has been dealt a tough hand. getting the company to a $20 eps number. >> reporter: heshe did abandon the forecast with her own strategy to reinvigorate the tech giant on mobility and security for

corporate clients, a plan expected to put the past years woes behind ibm so the stock rings up gains in the new year. for "nightly business report," i'm mary thompson. still ahead, intel started 2015 right where it left off in 2014. that would be higher as the shares soared nearly 40% in the past year. can they keep moving higher? well it probably won't take long for the new republican controlled senate to push for legislation to complete the

controversial keystone xl pipeline. next week when the new congress comes into session, a senate committee is scheduled to vote on legislation approving that pipeline. the vote will then pave the way for the bill to come up on the entire senate floor. it's been a long time coming. also in washington the white house today announced new sanctions against north korea citing the hack attack against sony pictures as the reason. john harwood joins us tonight from washington. john what are these new sanctions and who specifically are the targets? >> reporter: well bill there were two executive orders that president obama signed. one targeting the government of north korea. the other targeting the main political party there. also three distinct entities and 10 individuals. the challenge is that most of these people or organizations are already severely affected by the sanctions been in place for many years. the question is whether or not the united states government

might be able by sanctioning them specifically and ten people by name to convince other countries not to do business with some of the people. >> with any economic sanctions against a foreign entity, the question comes up. will they have any real impact. what do you think? >> not a whole lot. the north korean economy is pretty small. their economic relations with the world are small. it's kind of like what happened when the internet was shut down in north korea. only 1,000 ip addresses in the entire country. there's only so much you can do. but the administration is hoping to make a point to the rest of the world and also have some modest impact. >> let's talk for a moment about the new republican majority in both the house and the senate. do we expect the white house and congress to get any significant business done together this year or is that still a pipe dream? >> reporter: i think there are some things that can get done bill. first of all, if you simply fund the government avoid having a government shutdown avoid having a debt limit crisis then you have taken a step ahead of what congress has done the last

few years. those things were damaging to the economy, damaging to the markets. and they created uncertainty in the business community. so that's one thing. smooth waters on the budget. second are things like trade deals, there's the specific partnership with the administration actively hoping to finish sometime this year and get past through to congress this year. republican leaders support it the white house supports it. that is pretty well for the possibility to get that through. >> there's always hope. john harwood in washington, have a good weekend. >> reporter: you too. back to wall street now and close to tech giant intel, that was the darling of the dow in 2014. shares of the company shot up by more than 40% last year and closed slightly higher today as well. the question now, can that kind of run continue in 2015? josh lipton has more. >> reporter: a bet on intel is a bet on the pc and for those investors who wagered correctly,

they enjoyed a big gain in 2014. the pc market last year didn't crash and burn as many expected. instead, it was basically flat which was good news for intel. the company dominates the market for pc chips, which accounts for 60% of its sales. one tailwind for the pc market in 2014 microsoft support for its windows xp operating system. that profits companies to buy new computers. >> the fact that microsoft was removing support from windows xp powering 50% set in motion a large and significant upgrade for intel which any investor bought intel. >> reporter: how much of a tailwind that will be this year. intel expects pc units to be flat and revenues slightly down in 2015. the other big part of intel's business is providing chips for

servers which accounts for about 250 20% of its sales. can grow a 15% rate through 2018 at least. there are challenges however. company's mobile business is expected to keep losing money next year. but ceo brian who took over in may 2013 said he's committed to turning a profit in this business. we are in this business not to lose money, but to make money in the long run. he said that the company's investor meeting in november. no surprise after a strong run, some on wall street worry about the stock's valuation. the team at rbc said intel stocks now look pricey. still, bulls are in charge when it comes to intel, at least right now. betting on a stable pc market growth in the data center market and the company's on going commitment to capital returns. for "nightly business report," i'm josh lipton in silicon valley. lin energy cut the payout and budget.

that's where we begin tonight's market focus. lin is the latest to announce a cut in capital spending plan because of the recent drop in oil prices. on top of that the oil and national gas policy slashed the dividend to $1.25. used to be closer to $3. still, shares rose today up 12% to $11.35. rite aid saw stores jump last month topped estimates with help from strong pharmacy sales. the improving sales figure comes even after cheaper generic drugs weighed on the drugstore chain. 1.5% to close at $6.63. the medical products maker said it received a subpoena and u.s. regulate tors invest sales and marketing practice and sued one of its competitors of claims of business interference. stock tumbling by 15.5% to close

at $9.74. shares of bed, bath and beyond rose on an upgrade. cannacor cannacor genuity. up to $76.73. all week we had market monitor guests giving you tips and we continue tonight with richard steinberg who said we're in a "show me" environment right now. president of steinberg global asset management. happy new year rich. good to see you. >> you too, bill. >> you mentioned we had six consecutive gains in the market annualized. you're a big value player. do you still see good value in this market rite now? >> i want to go more bullish than i currently am, bill. earnings have come down from december 4th and 5th from 130 to 126 in the s&p.

we're at 130 but when you apply 16 month, you get to 2100. we hear 8 and 10% numbers but it's going to take a big show me in earnings increases and potentially a multiple expansion. when interest rates go up, oftentimes you get a little bit of a lift in multiples but i think it's going to really depend on what happens with earnings earlier in this quarter. >> it looks like you sound to be more selective. more of a stock by stock basis, aren't you? >> yes, and also in the etf space, investors have to be very target oriented. if they're beginninggoing to own something, and we're going to be in a volatile period. you have opportunities to pick up cheap namesment. even though the market may run in place, they'll be fixing stocks to make money. >> let's talk about stocks you find value right now. macy's in the retail sector.

>> macy's is trading at 13 times earnings. we have a $75 target. said you and i talked about before we think the consumer especially the low to mid end, is going to get a boost from energy prices and you have great management and you have weak competitors in j.c. penny and sears. >> sector that's volatile. why do you like this one? i guess you think it's still valuable. >> got busted up a bit because adb, which we own, didn't deal with express scripts in terms of being reimbursed for hep c. sold off gilead. the stocks trading very cheaply under 10 times earnings and the next four years, draw up close to $50 billion in cash flow. if they use $25 billion of that in the pipeline we think it's a cheap and solid name with $120

target. >> okay. and everybody's watching energy. consumers enjoyed the decline in energy prices. is it time to buy energy stocks? you like devn energy. why? >> they're 80% hedge with west texas over $90. the stock is trading at 1.1 times book and we think it's probably going to be a conservative way if money comes back into energy to buy the stock, we have a $75 target. all three of these stocks are in our growth portfolio. i don't know them personally but they're in the firm's growth portfolio. >> i know there's things that keep you up nights. let's let me ask you about the federal reserve, when they raise rates and when you think the market's response will be to that. >> well let's talk about what's happened to the ten year. the ten year is down to sub 2.25% right now. the bond market is actually getting us a little bit of cushion when the fed starts to increase.

i think they're going to be very methodical in increases of quartered on a point at a time. if you have a strong dollar and weak euro and qe going on in europe it's going to be very hard for the fed to increase rates too much too quickly because it will become anticompetitive for you as companies selling and could hurt job growth. we have know that people are focusing on job growth in the markets and in washington. >> that is for sure. richard steinberg of steinberg global asset management. thank you, rich. have a good weekend. >> take care. bye-bye, bill. the new year ushering up new laws to push the price of eggs much higher.

uncle sam's approval for new medications hit an 18 year high in 2014. the fda gave the okay to 41 new drugs last year including 15 medicines for so-called orphan diseases rare disorders that affect fewer than 2,000 people in the united states. new year brings a whole new list of layoffws and regulations. jane wells with notable and bizarre laws in effect for 2015. >> reporter: from california where illegal residents can now apply for driver's licenses to new york where you now have to recycle old tech gadgets, new laws reflect a changing america. from a worker perspective, about 20 states are raising their minimum wage. the highest being washington state which is closing in on

$9.50, but in seattle, it's already $15. in illinois employers can no longer ask about a criminal history on initial job applications. from a business perspective, in massachusetts, out of state wineries can now ship wine directly from consumers there potentially lowering prices and in health care arizona will allow residents to try medical treatment who have gone through clinical trials but not yet fda approved approved. in california over 900 new laws taking effect. where do you start? mandatory breast pumping stations at airports. mandatory sick leave for employees after working first 30 days. college campus receiving state aid, students have to clearly consent to sex. no means no isn't enough. being drunk isn't consent and the burden of proof switches to the accused. and all eggs sold from chicken, a square foot of space per bird.

twice the traditional average. sending eggs here have to abide. that could send prices up by 40%. and in california restaurants to allow dogs can if they follow certain rules. but if all the new laws about animals, none is more amazing than the one in new york. banning so-called tiger selfies. photos of people dangerously close to big cats. sounds like it's illegal to sit next to the tiger, just don't take a picture of it. but then what's the point? for "nightly business report," i'm jane wells. finally tonight, the new year means resolutions, of course, the usual commitments to lose weight get in shape. we spoke to people about what their financial resolutions are for the new year. >> creating a budget. sticking to it. >> try to get rid of student loans. >> save a little more. put more into the retirement plan. >> not overdraft my bank balance. >> i have a bank account and try

to put money in it not take it out. >> retire to do more travel. watch what we spend, not going out to eat, not going to the movies. all the luxuries try to cut back on this year. >> contributing more to ira. >> probably bring lunches to work. >> writing down a goal. if you don't write it down it's not real. >> let's hope we can all commit to some of those promises for 2015. that is the "nightly business report" for tonight. i'm bill griffeth. thank you so much for watching everybody. we'll see you again on monday.

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