nice to see you again. >> good to be here. >> susie: so you were pretty upbeat in your forecast. are you expectsing a strong global demand for aluminum. it's hard to imagine that given the gloomy forecast out of europe, out of china, even out of the u.s. so fell us where you see the demand. >> well, we expect 7% demand goals this year. we also expect that the-- we

see a very strong regional premium which show there is a tight innocence the market. where is that coming from? it's coming from aerospace. we have aerospace market these days with eight years of order backlog that's very substantial. and it's going toa while. we also see surprises here in the u.s., particularly coming from the automotive industry. and that's doubly positive for the aluminum industry because on the one hand we have seen so far in this year a 15% growth in automotive demand here in the u.s., very nice. in addition to that, we see that the amount of aluminum used in cars is going up. because lightweighting is the name of the game. emissions are coming down. consumers want to spend less money on their fuel and that's why they are going for. an on top of it there are new emissions regulations there, so this is all coming together. these are some of the right spots.

>> susie: well, certainly you have been getting increased orders from those two sectors but are the orders enough to offset the lower prices in aluminum? >> no, they are not. i mean and you have seen that in our, if you break down the situation in our company you see that the midstream what we call the midstream business and the downstream business, those are the fabricating business, what we make end products, some of those are aluminum but some are actually not aluminum, those are catering very strongly to those end markets, those are performing on a record level. we've seen on our engineer solution business another record quarter, 19.4% profitability in spite of the situation that they had at their one plant otherwise we would have been even higher in this quarter. they are going there quarter-to-quarter records, midstream, same thing. first half of the year record profitability almost double what we typically see here on a ten year average but if you look at the upstreamegment where it's basically commodities,

aluminum, they are very, very strongly impacted by the decrease of pricing. >> susie: all right, so what does this mean in terms of your hiring plans for the next six months and going into 2013? >> well, i mean the u.s. is probably the most interesting for your viewers and if i just look at the last 12 months, i mean we've increased our workforce because of the things that i just talked about, aerospace and automotive are two strong segments in the u.s. industry. we increased our workforce by almost-- people and we just invested in one of our facilities in davenport, eye way, 300 million to cater to the growing demand in automotive. so in regards to the general, the general outlook, i mean there's a lot of volatility there. but one thing i want to stress, and the volatility that is seen by what is going on in europe, for instance, you know, that is overriding the fundamentals that we see in our market.

the fundamentals in our market are-- we see the supply, demand. >> susie: let me ask you about that. let me ask you about that because we hear from a lot of business leaders and c.e.o.s who are very frustrated about the outlook, the uncertainty from policymakers whether are you talking about washington or from europe. so as a c.e.o., how are you feeling about business conditions these days? >> well, business conditions, i mean the one thing of the biggest business condition is that we'll be good if we had some more stability also coming into the market, a resolution of the euro crisis would be a nice thingment i don't believe that that is going to happen on the short-term basis but at the same time there is also quite a bit of psychology involved in here. because as you see in our industry, it's really flushing out the fundamentals. when you talk to people why are aluminum prices coming down, you very often hear because the fundamentals in at lum numb market are a problem. and that's not truement you actually see demand growth,

supply and demand basically being in a deficit or on par. you see the regional premiums at a record high. you see inventory substantially down. >> all right. i'm afraid i've got to interrupt and cut you off there. we have to run. hope to talk to you again soon, thank you so much. clause kleinfeld, c.e.o. of alcoa. >> tom: a huge merger in the healthcare industry, coming less than two weeks after the supreme court upheld president obama's health-care law. wellpoint is the nation's biggest health insurer. it's buying rival amerigroup for almost $5 billion. as erika miller reports, the deal will have a wide impact on consumers and other healthcare firms. >> reporter: there are two major government healthcare programs: medicare for the elderly, and medicaid for the poor. americans who qualify for both programs are a major target of the wellpoint amerigroup merger. officially, these patients are

called dual-eligibles. and because they tend to be plagued with medical problems, they're very expensive to insure. the flip side is that they are among the most desirable patients for managed care firms: >> the dual eligible expansion opportunity is tremendous and was a driving force for this transaction. recent estimates have indicated that approximately nine million people who are dually eligible for both medicare and medicaid today account for approximately $300 billion in annual healthcare spending. >> reporter: the federal government covers the cost for medicare, but it splits the cost for medicaid with the states. so states are desperately trying to reduce their healthcare costs and they're turning to private, managed care firms like amerigroup for help. >> by shifting money for the dual-eligibles into managed care, they'll be able to reduce their spending. >> reporter: the wellpoint amerigroup merger is the first big one since president obama's affordable health care act was upheld by the supreme count. but analysts think this merger probably would have happened anyway.

after all, amerigroup is considered a desirable merger partner, because it primarily serves people on medicaid. >> medicaid is one of the few areas in managed care that is still growing. we know that commercial managed care has not been growing that quickly, in fact it's been shrinking. >> reporter: today's deal also boosted the value of other medicaid insurers, wellcare, molina, and centene all surged double digits. but consolidation is likely to encompass other healthcare providers too. nearly all firms in the field are struggling to grow their bottom lines as they grapple with increasing cost- competition. erika miller, "n.b.r.," new york.

>> susie: grain futures prices soared again today at the chicago board of trade following a weekend of 100 degree temperatures throughout much of the midwest. late this afternoon the government reported the nation's corn crop is deteriorating as drought spreads across the u.s. as diane eastabrook reports farmers and traders fear things could get worse. >> reporter: when i visited this central illinois farm a couple of weeks ago drought had already claimed about 20% of carl neubauer's corn crop. today, neubauer estimates about half of his crop could be gone. at the chicago board of trade this morning the december futures price for corn hit daily trading limits on fears much of the u.s. crop could be destroyed. >> we could see disastrous yield if we don't rain for the next two weeks across the midwest. and, iowa is the biggest concern right now. there is no rain in the forecast for this week at least.

>> reporter: the most recent u.s. drought monitor shows about two-thirds of the nation is in some stage of drought. analysts say farmers in parts of southern illinois and indiana have already lost all of the corn they planted in the spring. last month the government estimated this year's crop would yield about 166 bushels of corn per acre. on wednesday it's expected to revise that number down to about 150 bushels. still some analysts think the real number is much lower. farmers are calling the summer of 2012 the hottest and driest in a quarter of a century. diane eastabrook, nightly business report, chicago. >> susie: that drought, is a big worry for companies like general mills. tomorrow, we'll ask c.e.o. ken powell about the impact of rising food prices on his firm's bottom line, and he gives us his outlook for the second half of the year. >> tom: even with a slowing u.s. economy and the european anxieties, the first half of this year saw strong returns for

stock investors. all this week we're looking ahead to the second half of the year for investors. in a phrase: buckle up. >> reporter: a presidential election year can bring with it plenty of uncertainty for stocks. and this year is no different. what is different this election year might be the magnitude of the uncertainty, and the nervousness that comes with it. there's the fiscal cliff, the expiration of tax cuts and automatic government spending cuts that will take effect early next year if there is no action by congress and the president. there's also what some regard as the monetary cliff: the federal reserve's latest effort to bring long-term interest rates down, called operation twist, runs through the end of the year. >> there's so much uncertainty in the market whether its the fiscal cliff, the elections, we're just heading into earnings season and it's thought that earnings will be a little bit softer this quarter. >> reporter: tim murphy's firm tracks recommendations by institutional brokers. and sell short recommendations are at their highest level since the lehman brothers collapse in 2008. selling short is a technique to profit if a stock price is going down, but the pessimism isn't

expected to last. >> once we get through the period the sentiment seems to be the fourth quarter should be a lot better. >> tom: historically, the fourth quarter during a presidential election is positive, up 2% on average for the s&p 500. among the stocks murphy says are seeing bullishness from brokers: discount retailer dollar general, biotech drug maker vertex pharmaceuticals and financial giant a.i.g. >> the gary thayer is the chief macro strategist of wells fargo advisors joining us from the gateway to the west in st. louis, is this a matter of just surviving the third quarter hoping to thrive in the fourth quarter? >> well, tom, you know, we do have this uncertainty lingering here affecting a lot of investors and their attitudes toward the market. but you know, it's one of these environments where we think the fundamentals are a little positive right now with the monetary easing that we're seeing around the world. and even our housing market

is starting to show some signs of life. we do think the market may be choppy going into the election. but we do look for a better end of the year. >> tom: better end of the year so what types of stocks, where in the world are you finding them? >> well, right now if we look around the globe we do see a lot of problems particularly around europe and some of the developed countries so, on a global basis we are favouring the emerging market stocks. and underweighting at this point some of the developed country stocks. and even weighting the u.s. market. so we do recognize that there is a lot of risk out there in some parts of the globe. but overall we do think we're still in a global recovery. >> tom: we showed the eem exchange rated fund for emerging markets as illustrative for that sector. what makes you go after the risk there. certainly there can be some rewards but there can be some outside risks overseas? opinions sure. i mean obviously there's a lot of uncertainty there too. it's not just where we have the election, we have a lot of political uncertainty and inn other countries. and with the slowdown in the global economy, we still have to be concerned at what the policymakers may do

overseas. but we do think that a lot of those concerns are baked into the market right now. we have had a big pullback in some of these international markets over the past quarter. and we think it's a good time to get in there and get some value. >> tom: let's talk about fixed income here because the bond market has seen a crush of investors looking for safety here. the yield on the ten year government bond, you know this chart very well, it has just dropped like a rock. 1.5% tonight as the bond prices at some pretty hefty levels. what is the risk for fixed income investors. >> at this point with yields being near historic lows we don't expect them to go down a lot further so there is a risk to fixed income investors if they are buying for the long term. that those yields could turn around and start to move up if the global economy strengthened. in that case, they can see some erosion in the value of their fixed income. or they could be missing out on some other opportunities in other markets. >> which do you see is the greatest risk between now and the end of the year. the opportunity of staying

if bonds, or the volatility. >> i think it's about even. we are looking for fixed income markets to maybe strengthen. the yield goes up here in the second half of the year. so there could be some price erosion. again we do think equity could be high tear. so it could be a combination of both. >> any position in the ecf that we mention tonight to el straight your sectors. >> no, don't hold those. >> tom: looking into that crystal ball, it's gary that i we are us, with wells fargo advisors

>> susie: in less than six months, income taxes are due to go up, unless president obama and congress agree to extend tax cuts. today, president obama officially called for lower taxes to continue for most americans for one more year, but not all americans. sylvia hall takes a look at the president's push, and how it could affect the nation's bottom line. >> reporter: with the chances of solving the nation's budget problems this year almost non- existent, the president pushed for a short-term way to ease them. while he wants to extend the bush-era tax cuts for one year, it only would be for families making less than $250,000 annually. >> let's not hold the vast majority of americans and our entire economy hostage while we debate the merits of another tax cut for the wealthy. >> reporter: the senate is scheduled to vote on the measure soon, but it's not expected to pass. however, the vote moves taxes to center stage in the election- year debate, and highlights the differences between democrats and republicans. republicans generally want the tax cuts extended for everyone next year, including the wealthy.

>> it's true that the high-end tax cuts are not the most powerful tools for providing a very short-run, keynsian demand stimulus. but they are extremely important for the long-run perspective because they provide incentives for saving and investment. >> reporter: according to an analysis prepared for senate republicans, letting the tax cuts for higher income families expire would bring in $68 billion. but others say it's time to stop the bush-era tax cuts, and find a fresh approach. >> i would personally favor letting all the bush tax cuts expire, and doing something explicitly short-term like a payroll tax cut that i think would be more effective. i think it would put us on a better short-term path and a better long-term path. >> reporter: if the fiscal cliff takes shape, it could slow u.s. economic growth to a crawl, according to the congressional budget office. even the gridlocked congress agrees something needs to be done this year to prevent it. sylvia hall, "n.b.r.," washington. >> tom: ahead of the big news out tonight with alcoa better-than-expected earnings its stock indices had a week tone, let's gets

you up update and the market focus. the s&p 500 hit its low for the session at noon eastern time. the losses were pared back in the final hour after the federal reserve reported a strong jump in consumer credit in may, a sign consumers are comfortable spending on credit. the materials sector saw the stiffest losses, down 0.7%. the energy and consumer discretionary sectors rounded out the top three worst performing sectors. volume was steady, 648 million on the big board. just under 1.5 billion on the nasdaq. before alcoa's better than expected earnings report, chemical maker du-pont was the stock weighing on the materials sector. shares slipped 2.9%, dropping to a five week low. volume was more than double its normal pace today. coal stocks were cooling the energy sector. alpha natural resources fell 7.5%. peabody dropped fell more than 6%. consol energy ended down 2.3%.

coal miners were weak in anticipation of patriot coal declaring bankruptcy, and after the close tonight, it did. the stock lost almost three- quarters of its value before the chapter 11 reorganization filing late today. the stock traded below 40 cents per share in after hours action. the company blames competition from cheap natural gas and weaker demand due to the weaker global economy. u.s. oil prices rallied back over $85 per barrel. major european oil supplier norway is dealing with a labor stand-off. the norweigen producers have threatened to lock-out striking workers. norway produces about 2% of the world's daily oil supply. healthcare put up the best performance today among the ten major stock sectors, and drug maker merck led the dow industrial gainers. today's 1.5% rally takes the stock to a four year high. in recent sessions, the stock has been able to break out above $40 per share, which had been a price it experienced selling pressure. we saw a monday merger in the food business.

campbell soup will buy bolthouse farms. this is a $1.6 billion deal, expanding campbell's portfolio beyond soups into juices and fresh-packaged foods. the two know each other already. campbell buys carrots for its soups and v-8 juices from bolthouse. campbell stock fell 0.8%. soup sales have been slowing as it looks for a way to kick-start its traditional business. a couple of high profile tech stocks experienced stiff selling. semiconductor maker advanced micro devices fell 2.3% during the session, and another 9% after the closing bell. the company lowered its financial outlook due to weaker sales in china and europe. and research in motion lost 5.3%. c.e.o. thornsten heins meets his shareholders at their annual meeting tomorrow. the company's blackberry devices continue struggling against competitors. all five of the most actively traded exchange traded funds were lower, with the russell 2000 and emerging market funds dropping the most. and that's tonight's "market focus."

>> tom: one of the most popular investment strategies has been dividend maying stocks, bonds paying such low-interest rates investors have been looking for companies that pay shareholders. which leads us to tonight's word on the street, yield, lindsey bell san investment analyst with the street.com am looking at dividend yield here, lindsey, is there an important difference between how much a dividend is and how much the dividend has been increasing? >>. >> yes there is. you can have a high dividend yield on a stock which is basically the dividend per share divided by the stock price. or you can have a company

that is consistently increasing the dividend dollar value that they pay every year. now some companies have a high dividend yield simply because their stock price is low and beaten up and it's not a good thing. but others they have high dividend yields and they have high growth. and if you could find that mix, that is what you want to go for. >> tom: it's a powerful combination. a lot of folks have been looking at utilities for that, strong cash flow, of course, with the regulated businesses. dominion resources is one of those that you have identified here. ticker symbol d, the yield just under 4%. but the share price has rallied very nicely. what's to come? >> you know what, this has been a greet yaelder for a long time them have been paying their dividend for over 30 years and growing it at 8% a year, over the last five years. that includes the recession so pretty impressive. >> very impressive. health care another defensive play, j & j, johnson & johnson, the stock price in the last 6, 8 weeks has a nice rally from the low 6 0s not upper 60s.

still yielding over 3.5%. what's to come? >> well, this company is kind of boring but sure steady eddie. they provide you your tylenol and band-aid products but the dividend yield is pretty nice at 3.5%. and it's been growing at 7.5% annually for the last five years or so. and they have been paying that dividend for over 50 years. >> tom: one thing. >> i don't think it going away soon. >> tom: one thing we know isn't going away soon is tax. h & r block you identified as a dividend grower. the share price may knock down some investors portfolio but still yielding 5%, a bit more volatile for this one. >> yes, a little more volatile name and that 5% dividend yield is pretty high. i mean as we mentioned before, eye high yielding stock is anything with a 30% dividend yield or higher. so as that stock price eventually recovers and goes up, you probably could see that yield come down. but that being said even though the stock has been

beat up, it's still increases dividend 7% for the last few years. so you are kind of making some return on this investment. >> tom: dividend payer, dividend growers, dow own anything we mentioned tonight, lindsey. >> i do not. >> tom: lindsey's article has additional ideas on thestreet.com t this is word on the street with lindsey bell. thanks. >> tom: susie, we'll see you then.

>> susie: good night tom and everyone, we'll see you online at: www.nbr.com and back here tomorrow night. "nightly business report" is brought to you by: captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org