eport,"ghtly business i'm diana olick in washington. >>> time to take a look now at today's upgrades and downgrades, beginning with southwest . airlin they were downgraded over the short term at least. the analysts there cites pressure from rising fuel costs in the comingrs quar but the firm has a favorable outlook longer term. shares re a fraction today. amd's price target was raised. the analyst predicts the chip maker will rort better than expected profits in 2020. he firm maintains i outperform rating. shares rose slightly to $16.34. >> davos price target cut to $39 at jpmorgan citing persistent margin headwinds after a report of a strong quarter but weaker than expected cash flow. the stock fell 6.5% to $27.73. and coverage of united technologies was resumedn with overweight rating at morgan the analyst cites the potential for corporate restructuring and if positive on the rockwell collins acquisition, the price target there is $160. the stock fell slightly to $126.91. >>> still ahead, a stock our market monitor says is in the eet spot. his list of recommendations coming up. ♪ ♪

diana olick has the details. >> home builders didn't start more homes in may compared to april, but they did sell more homes. sales of newly built homes jumped wider than expected, 6.7% after april's read was revised down. here was one more devil in the details. >> all the growth in housing, new home sales is in tso h, warehousing is affordable. and that has implications going-forward. if interest rates ticked up sharply, will it not even be affordab in the south. >> sales jumped dreatically in south, which is where builders are business jest and prices are the lowest. it may be why the medn price of a newly built home dropped 3c in maypared to a year ago. builders are not really focused on lower priced homes, because they can't make as much money on them, especially as the cost f land, labor and materials continue to rise. mortgage rates continued their charge higher in may. and while they didn't seem to heyt much in the south, likely contributed to the drop in sales in more expensive regions like the west. >> the bottom lineis, they're going to hurt sales going-forward. they probably a

diana olick reports tonight from boston with a look at what's being done there to safeguard buildings and billions of investment dollars. >> reporter: winter slammed hard into boston this year. back-to-back nor'easters sent water flooding into its historic streets and sea ports. it was what city planners predicted, just not yet. >> in boston we've spent a lot of time thinking that these impacts are 20, 30 years down the road. these storms are here now. they're happening more frequently. they're more severe. >> reporter: deanna moran studies the impact of climate change on boston real estate, especially its new development. >> the planning has been great, but we just aren't there yet. >> reporter: the planning started at the top in the mayor's office and its climate ready boston initiative headed by austin blackman. >> if you want to build a large building in the city of boston, not only do you have to take into account what the climate conditions are and the flood plain projections are now, but you have to look into the future. >> reporter: so far it's just conversations and recommend

diana olick?is may sound backgrounds but the shortage of skilled construction labor is causing an oversupply of new apartments which will continue for a few years. so how is that possible? all right, well, it's all because developers were trying to meet the high demand for apartments several years ago during the recession when home ownership plummeted to the record low but it took them a really long time to build what they started because they didn't have enough labor. so the construction industry lost over 1 million skilled workers during the housing crash and most never returned so a lot of the new buildings that were supposed to be finished when demand was high were not so - >> so what happened in the supply that was supposed to come out of the '16 pushed into '17 and what came on in '17 got pushed into '18 and now it will be pushed to '19 it has been a real challenge because every year we think aha this is the peak supply, it will decrease now but what's been happening is it gets bumped into t

for "nightly businesseport," i' diana olick in >>washington. mcdonald's is cutting jobs and that's where we begin tonight's market focus. the fast food chain saidul it layoff an undisclosed number of workers in an attempt to streamline operations and reduce costs by the endf 2019. mcdonald's said it would end iidance on the number on positionsacted by the town hall meeting which is set for june 12th. mcdonald's shares rose to $169.48. j.m. smucker's said weeker demand causedrofit and sales to disappoint. the maker of jiffy and pillsbury said the increase in marketing costs would cause the earnings for the year to come inr wea than expected. shares were off 5% to $100.80. >>> ralph lauren is hiking the dividends 25%. they expect sales to rise at a compound annuaate in the low to mid single digits. operating margins are growing in the mid teens. shares, nonetheless, were 1% to the down side to >>> furniture retailer kanns turned a profit and saw revenues rise. the company cited increase in same-store sales and improved margins. kanns sees same-st

back to you. >> see a big spike on amex shares there diana olick outside the court today. >>> startingday, amazon prime members will get discounts on a wide rachbnge of products at whole foods. the biggest boost could come from the ad business according to rbc's mark mahaney who says the ad platform could rival google and facebook within five years. mark, good to see you again. >> good morning, carl. we've spent the past year or two getting used to the power of aws but now it's time to pay attention to amw, the marketing services >> there's been new disclosure that essentially implies they are at around the $7 billion revenue run rate for advertising based on a bunch of checks we've done 125 advertisers survey report. we think this business is on track, probably not to get up to facebook and google levels any time soon but to get about $25 billion in avenue revenue within five years and it's a highly profitable business. that's one of the most interesting takeaways from this which amazon is two great revenue makeshift stories. aws. but then ams not capital intensive. so as a bull, a lo

our diana olick went to postbosn to see what's being done to safeguard billiouildings and bin of investment dollars. she joins us with more >> from floods to fires to the wildest hurricane season in memory, last year, 16 separate weather events in the u.s. caused more than $300 billion in economic damage, much of it to residential and commercial real estate but even with the frequency and intensity of recent superstorms, building along the waterfront continues, putting property and investment capital at risk and that's our cover story today. >>> winter slammed hard into boston this year back-to-back nor'easters sent water flooding into its historic streets and seaport. it was what city plarnners predicted, just not yet. >> we've spent a lot of time thinking that these impacts are 20, 30 years down the road these storms are here now. >> reporter: deanna moran studies the impact of climate change on boston real estate, especially its new development >> and the planning has been great, but we just aren't there yet. >> reporter: the planning started at the top, in the mayor's office, and its cl

diana olick has more. >> reporter: with fewer of thesr around, s more of this going on. if you can't find a bette bathroom, rebuild your own. more and more homeowners are doing just that. >> people get frustrated loo ang fo house in the right neighborhood at the right price pond it does generally make more sense to just customize your own home. >> reporter: and while kitchens and bathrooms are always most la po the master bedroom suite has moved up to number three in most popular remodels according to house, a new website. >> master bedrooms are the third most popular to renovate. the spent is 33%. that's prey consistent with over 40 million unique users. reporter: likely because the homeowners are focused on resale value. >> you will get more bang for the buck and a better return when you go toell to have that full master suite. >> reporter: but getting the best bang for your renovation buck is getting harder because it's harder to find contractors to do the work. the same labor shortage that's keeping more new homes from being built is putting renovation projects on ho

diana olick. >>> just so you know, hp ink c.e getting a little bit of a pop.on a stock buyback. just keeping an eye on that one. thanks for tuning into "closing bell," everybody "fast money" begins right now. >>> "fast money" starts right now. live from the nasdaq market site overlooking new york city's time square, i'm melissa lee. tonight on "fast," bitcoin showing signs of life despite a cryptoclash. founder of light coin will be here to see why the crypto-universe is about to moon >>> plus the bid and who will the loser buy instead. the traders play a special game of match maker we start off with fang gone wild these stocks

decision is housing, home buildingtock getting whacked today on the prosecretary of higher rates diana olick joining us. >> builders are having stocks tanking today for several reasons, take a look at the first, that is the mortgage rates shot back up aga again. that put a strain on mortgage applications according to the mortgage bankers association. politics were lower for the week and lower than the same week one year ago we haven't seen an annual drop since last april when interest rates really spiked. a report from core logic noted that half of the 50 housing markets are overvalued back to you guys >> it's nice to be with you, diana. >> fantastic diana olick, we're just moments away from the fed's decision ra onrait hikes dot awhe,e vet n'gonyer wha i all for you right after this at fidelity, our online u.s. equity trades are just $4.95. matter wu trade, or where you trade, you'll only pay $4.95. fidelity. open an account today. >>> we are four minutes away from the fed decision on interest rates let's get to our panel john bellows portfolio manager lori is head of equity strategy of rbc

first, let's get to diana olick in washington.nding homes >> carl, pending home sales in may down, 0.5% for the month down% for the year and that is the fifth straight month of annual losses remember, these are signed contracts to buy existing homes so people out shopping in may, you might have seen the sales of newly built homes rose in may but only in the south where homes are most affordable and reel realtors are pointing to affordability. it continues to hamper first-time buyers and move-up buyers as well as the supply situation which is getting even worse. too few homes for sale home sales fell in all regions of the nation for the year, but monthly they did rise in the northeast and the midwest and slightly in the west but they fell in the south. remember that pending home sales are an indicator of future closed sales in june and july. that's a miss. the street was looking for a slight gain. sales down 0.5%. >> diana olick, thank you. >>> we're going to start with this rebound we're seeing in stocks pretty sharply as the tech

. >>> still ahead, summer is horseshoe crab mating season but that is not why diana olick is there. sure you've seen some, but i'm sure that is not the real reason. >> vacation edition. we're talkin$24 llg miion tear down we'll tell you about it coming up on "power lunch." you always pay your insurance on time. tap one little bumper, and up go your rates. what good is having insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't rais rates due to your first accident. switch and you could save $782 on home and auto insurance. call for a free quote today. liberty stands with you™ liberty mutual insurance. jimmy's gotten used to his whole yup, he's gone noseblind. odors. he thinks it smells fine, but his mom smells this... luckily for all your hard-to-wash fabrics... ...there's febreze fabric refresher. febreze doesn't just mask, it eliminates odors you've... ...gone noseblind to. and try febreze unstopables for fabric. with up to twice the fresh scent power, you'll want to try it... ...again and again and m

in our continuing series, diana olick reports on the project she joins us with more >> that heavy rain warning and a lesson storms like that are becoming more common and forcing scientists and developers alike not just to rethink how we build but to reimagine how we live ♪ >> reporter: it was a freak storm. dumping over two feet of rain on the baton rouge area swif rivers swelled flooding more than 100,000 homes nearly $4 billion in property damage alone justen aaronworth is ceo of the water institute of the gulf. >> we're trying to be better prepared for the next flood. >> reporter: ironically as the rain came down in 2016, a $60 million project in downtown baton rouge was going up a water research center called the water campus home to the just opened water institute of the gulf. >> there are ways to use the best of science to better prepare, better respond and get assets and people out of harm's way. >> and also to better build. >> and to better build. >> reporter: this as baton rouge is in the midst of a building boom the number of construction permits nearly doubled in the last fi

diana olick joins us with more >> it's the supply in housing that pushes prices higher.mped in april compared to a year ago. that's slightly less than the 7% annual jump we saw in march, but it's still making more markets unaffordable in fact, of the nation's 50 largest housing markets, 52% were considered over valued in april. core logic determines affordability by comparing home prices to their long run sustainable levels based on localincomes a market is over valued when they're 10% higher than sustainable levels an increase from march when just 50% were considered overvalued in april 34% of the largest markets were considered at value and only 14% were undervalued. now, not all expensive markets are considered overvalued. san francisco, for example, where prices are up more than 12% from a year ago, that is considered ad value because local incomes in the area can support the home prices. boston is also considered at value. over valued markets include denver, washington, d.c., houston, miami, new york, las vegas, and los angeles home prices continue to rise at more t

diana olick. >>> just so you know, hp ink c.e getting a little bit of a pop. the company higher on a stock buyback. just keeping an eye on that one. thanks for tuning into "closing bell," everybody "fast money" begins right now. >>> "fast money" starts right now. live from the nasdaq market site overlooking new york city's time square, i'm melissa lee. tonight on "fast," bitcoin showing signs of life despite a cryptoclash. founder of light coin will be here to see why the crypto-universe is about to moon >>> plus the bid and who will the loser buy instead. the traders play a special game of match maker we start off with fang gone wild these stocks are out of control. as the nasdaq closes as a record high, hitting fresh all time highs today. facebook, amazon, google all up double digits in the last month. we thought it'd be perfect time to play a game here. we like games, right kick it off at the top trade it or fade it fang style pete, we'll kick it off with you and facebook trade it or fade it. he's over there -- >> there was music and guy was dancing. we did

what does it mean for the housing market >> diana olick is looking at the number >> there was a negativepril's reading sales were up 14% compares to may verses a year ago. that's a wider annual jump than april. as you can see those sales are still well below historical norms of demand. never mind the spike during the housing boom most of the demands are at the low end where builders have the tightest margins they're building higher in homes and demand is lower so they are putting up fewer of those homes. notable change in today's report the median price of a new build home was lower than a year ago that could be a welcome sign going forward. >> back to you >> for more now in the jump in the new home sales and what it says of the health of the housing markets. let's bring in patrick newport with ihs markets patrick, is this up stake in sales so highly regional that we should make more of it than maybe the headlines suggest? >> patrick, that was for you and susan, i will get you. >> that's what we are seeing this year and so it is yes, it is recovering in the west and the south and now on

diana olick joins us. >> a storm flooded the area and caused billions of dollars in damage to both residentialnd commercial real estate baton rouge on the edge of the mississippi is now becoming a research hub for the study of rising water >> it was a freak storm. dumping over two feet of rain on the baton rouge area rivers swelled flooding more than 100,000 homes. nearly $4 billion of residential property damage alone, according to louisiana economic development. justin aaron worth is ceo of the water institute of the gulf. >> what we are doing now is to be better prepared using science to better prepare ourselves for the next flood. >> ironically as the rain came down in 2016 a $60 million project in downtown barrage was going up a water research center called the water campus home to the just opened water institute of the gulf? there are ways to use the best available science to better prepare, to better respond, and to be able to get assets and people out of harm's way >> there is better build. >> and to better build. >> this as baton rouge is in the midst of a building boom the number of

diana olick joins us here on set. >> big mortgage day. >> for you to be here. >> yeah.ally mortgage rates dropped a little bit took a little -- lower compared to a year ago. the jump clearly thanks to the lowest interest rarts in six weeks. the average here on the 30 year fixed fell nine basis points to 4.75% from 4.84% mortgage rates began rising at the start of this year and moved sharply higher at the start of april. this pullback in rates began two weeks ago loosely following the drop in the 10-year treasury yield. still 17% lower than a year ago when rates were even lower than right now. mortgage applications also increased 4% for the week. 9% higher than a year ago. buyers are less worried about rates and more worried about the lack of homes for sale pushing prices higher. that has been behind the overall drop in home sales the jump last week may have been less about lower rates and more about some more listings hopefully coming to the market >> diana, we've talked to real estate people who told us even if rates go up, it's not going to affect home sales >> for th