This is nightly Business Report with Tyler Mathisen and sue herera. Funded in part by all it takes is a spark. One idea to take flight. The courage to seek the unknown. To innovate, disrupt, to move us all forward, to explore a different perspective. At nasdaq we connect the world, its ideas, its capital, its businesses, the people that drive global economy, the future is not tomorrow. Its right now. All it takes is a spark. Nasdaq. Stocks steadied after yesterdays selloff but are there cracks in key areas of the market . Sears once dominated retail. Now it is under sure whether kit stay in business. Locked out. Why perspective buyers are having a hard time becoming homeowners. Good evening. Welcome. The focus is on fundamentals. Bond yields, toil market and the Transportation Business which is the back bone of american commerce. But not all investors liked what they saw and that lack of enthusiasm translated into a bit of a tugofwar on wall street. The Dow Jones Industrial average off 6 points to 26,661. Nasdaq rose 27. The s p 500 gained 4. The focus domestic markets was so strong that investors shrugged off the deadly attack outside british parliament, an attack police are treating as terrorism. Where some cracks may be forming. The stock market weakness highlights a few of the sxoinlts concerns that traders and investors have about whats happening in the overall marketplace. And theres a lot to talk about. Lets narrow it down why some investors are concerned about whats whats happening. First of all, you have treasury yields. Interest rates on u. S. Government bonds. They are moving lower which means people are buying up the safety there. If Interest Rates keep falling, could it be a sign people want safety as opposed to the risk and return . That leaves the bank stocks. Theyre heading lower and took a big hit in the recent downturn. One of the reasons is that as these Interest Rates move lower, the profitability had goes lower. Thats the bank stock side of things. Small capitalization stocks, the russell 2000 index. If theres weakness there, may be it spreads. Another place to watch, transportation stocks, trucking, rails, airlines. If these stocks arent moving around as much to the upside, it may mean people are not shifting as much. And then finally, lets talk about oil prices. Weve seen pay at the pump go away a little bit. Oil prices have fallen. With energy stocks, it is ball whether weve seen it trend lower. Again, five of the bigger themes, there arent many out there. This is why they are worried in this recent stabilization slash downturn in the market. For nightly Business Report. And according to the latest bank of America Merrill lynch global survey, a record enough of professional investors have concerns about the market as well. Michael is the chief strategist with Merrill Lynch and he joins us to talk about the study. Nice to have you here as always. Lets start first with some of the findings of this survey, and i was struck with, you say a Record Number of investors. 34 , the most in 17 years. Find market overvalued. Thats a pretty stunning statistic. It is. The market is after all at an all time high, or was very close to an all time high. It shouldnt be too surprising. Nonetheless it does reflect while people are very bullishly positioned, they want to be in the market. They see the price action forcing them in. They have this one big nagging worry that things are not cheap. But they also have this problem of where do they go . So it is a real reluctant bullishness will. Speaking of bonds and Interest Rates, i note the one thing above all the factors that they think could bring the end to the equity bull market is rising Interest Rates. Tell me about how pronounce that had feeling is and what is the level at which they think Interest Rates could slay the bull . Well, they fear the central banks. But in a very small way at this moment. Last week may have been a very important week. We see the synchronized policy. I think we see, is it going to grow . Right now theyre saying, unless you get a tenyear treasury yield that exceeds 3. 5 , well be okay. And any increase will be a good increase in Interest Rates, rather than a bad one. Theyre managing for people in many cases and they have to deploy that cash. Are they looking globally . As the graphic just indicated, the u. S. Market seems to be the most overbought. Where are they finding opportunity . Very much so. That has been the story over the next couple weeks, maybe a month or two. What youre not seeing is saying goodbye to the equity market or the u. S. Equity market. Theyre saying, u. S. Stocks look very, very rich. Lets look at japan. This month we saw some rotations toward the merging market. So youre seeing an equity story that really, from a positioning perspective is one of rotation rather than a major reversal. When did you take had survey . Im curious. The question is what are they doing with cash . Are they deploying it . Hoarding it . Raising it . Well, cash is one of the most watched indicators from the survey. It is a survey of about 250 investors around the world. It has a great history, a very good track record. And the survey ended. Late thursday last week. The instant snap shot. Cash is one of the things that people watch a lot because it has a great track record in terms of market typing. When you see it below 4 . That equals greed. When you see it above 5 , that equals fear. You want to buy the figure last week was 4. 8. It is coming down but not yet at the levels that say you have to get out of stock market. On that note, thank you so much. Great information. With bank of America Merrill lynch. Investors watching the drama unfold. The Health Care Vote is expected to take place tomorrow. The chair of the House Freedom caucus said conservatives opposition is strong. That raise doubts about the legislations future. As weve been reporting, wall street growing concerned that a delay in Health Care Reform could slow the administrations ability to push through pro growth policies like tax reform. The proposed border wall is another issue in washington and it appears fast the back lash among some lawmakers is growing are. The good to see you, elon. How are state and local officials trying to stop companies from participating in building the wall . Good evening, sue. Well, there are really two ways that state and local officials are looking at this. One is to Ban Companies that sit on the wall from receiving local government contracts. Thats number one. Number two, time to pass completion would prevent them from investing in companies on the wall. Some of the straits california and new york and some of the cities are new york city, san francisco, oakland, berkeley. These are some of the places where we see this back lash over at the border wall. Have we seen laws affecting the pension funds, Investment Strategy pass like the before . What has been the effect of that . Where weve really seen it in the past is around tobacco, for example. So the Public Pension Fund in california, one of the largest in the country, they recently decided to remain divested from tobacco companies. Theyre not going to invest in it because they do not deal socially, ethically, morally. Had however, what the funds say is that it is important to remain engaged in the Companies Rather than invest fully. If you pull your money out, now longer have influence over the companys decision. What is the status overall of the border wall . Bring us up to date. We saw the First Federal dollars being requested. About 4 billion over the next two years. The government has put out the official request for proposal in building the border wall. Theyre looking for a 30foot wall made of concrete and perhaps some other times of fences or nonconcrete structures as well. Were starting to see real money and real details about how this would get built. Thank you as always. Also, on capitol hill, president trumps nominee to lead to Labor Department testified at his confirmation hearing. He pledged to Work Congress to help workers gain access to training. It was clear everybody wants americans to find jobs, good jobs, safe jobs. Even if we dont all agree on the how. I share this goal with you. We may not always agree on the how but at least let us agree on the need. He said he would enforce labor laws fully and fairly. And investors are watching the Federal Reserve and the direction of Interest Rates. Today, he said he expects three Interest Rate likes this year. Inflation closed to the feds targets. He is watching the haerk debate unfold had washington. Sales of existing homes fell. Buyers are out but there are obstacles in their way. Home shoppers are finding fewer listings and higher prices. And both are standing in the way of satisfies. February it was warmest in half a century, but sales chilled, falling hardest in the northeast and only managing a small gain in the south. Realtors say theyre seeing far more potential buyers but not even close to enough listings to neat demand. Supply is down over 6 from a year ago and has been falling for nearly two years. Why . For one, builders are only operating bat 70 of their normal production level. They blame a lack of land and labor as well as the rising cost of regulation for their slow and wobbly recovery. What were seeing is the share of new homes that compared to all home sales, only about 11 or 12 . I should be about 24 . Normally that might not raise much of an eyebrow but it should raise eyebrows now because existing inventory and home sales is still holding. It is not the just the builders following housing crash. Investors scooped up Bargain Basement depressed properties, adding 4 million homes to the rental stock. Theyre not selling them back into the market as some expected. Investors came in to get cash flow and it remained very positive. And the price deappreciation is extra gravy. Theyre saying theyre going on ride out the price increases. Not only investors not selling, theyre buying more and theyre using cash to do it. That leaves he mortgage dependent buyers, looking for a good deal. Still ahead, hard times. Sears used to be a retail store. Now there are questions about its future. Sears and kmart, staples in malls across the country. After years of mounting losses, they issued a dire warning about whether it will be able to keep its doors open saying that it has, quote, substantial doubts about its future. You dont matter every day. Shares plunged, down more than 12 . What might be next for sears. Its no secret sears payday has long passed. The 184yearold Department Store hasnt acknowledged the extent of its trouble until now. In its annual report, it indicates substantial doubt exists related to the companys ability to continue the growing concern. Results that includes losing nearly 10 billion in six years and spaels continue to plunk year after year. Now just 40 of the satisfies it had at its peak decade ago. Ted is a Retail Consultant specializing in restructuring. He worked for kmart before it was bought 15 years ago. At this point, they havent put anything on the table that would make outside stake holders like the Vendor Community comfortable. That the next year is going to be one where their exposure to kmart and sears is not a significant exposure. Sears has undertaken complicated steps. Lambert owns both the sears shares and its debt. Sears has borrowed cash from and bonds to the hedge fund, closed hundreds of stores, sold real estate and stores. Still some estimate sears will burn through almost 2 billion in cash this year and need the same amount to ten operating. While the retailer says it is taking took mitigate down about its survival, doubt seems to be the Market Sentiment when it comes to sears future. Fornightly Business Report. Pay she is eyeing bankruptcy protection. It could close as many as 500 stores as and it the industry as a whole try department to online shopping. Win baggo. They saw re new spike 64 thanks to record shipments of rvs in the u. S. Shareholders were happy campers. Oh there you go. Up 6 to 29. 55. A new york judge ordered exxonmobil to recover lost emails from an account by Rex Tillerson while he was ceo. Theyre under investigation for allegedly misleading share hold betters the risks of climate change. Exxonmobil shares down 7 cemeteries at 81. 76. At t said it is pulling its business from google owned youtube over kerneconcerns of a. And verizon said would it also pull its ads. Google has been dealing with back lash over ads appearing next to objectionable content on youtube. Shares of google were down a fraction today to 8 849. 8. In had they plan to have 68,000 of the jobs in the u. S. The Ceo Howard Schultz reiterated the social impact commitment. I recognize more than any other time, im here to serve our shareholders. At the same time, work with like minded ceos and elected officials to try to move the country forward. Millions of americans are not in work, not in school, and really facing challenges that require a more compassionate understanding. Shares of starbucks rose 35 droenlts 55. 89. After the bell, there were better than expected Fourth Quarter earnings. They said they plan to open about 400 stores this year. Shares rose in extended hours trading following that news but ended the regular session down nearly 2 . The technical change at New York Stock Exchange wreaked havoc on electronically traded funds, ets, earlier this week, affecting those with market value. With the etf industry, more than 3 trillion globally, will the risks also grow . Ben johnson joins us now to discuss it. Ben, welcome. Good to have you with us. Is there anything we need to be worried about, about etfs and their ability to be traded effectively, efficiently in the marketplace . Thanks for having me. What i would stress at the onset is that this issue is an issue, not with Exchange Traded funds but an issue that is unique to the exchange. And the Software Glitch that resulted from an updating of the Closing Price mechanism specific to the New York Stock Exchange. I did not affect the etfs traded on the other exchanges. Nasdaq. And it is unique the etf. The et stands for Exchange Traded. So coming with that feet sura unique set of risks and responsibilities that ultimately present a burden and a learning curve for investors who have to know how to trade safely. And you make the point there are a couple things people need keep in mind in materials of when to trade the etf. The beginning of the day, and toward end of the day. Tell me about that. Absolutely. So following a few simple best practices, investors can all but immunize themselves from some of these risks. So avoid trading etfs near the open. Theyre a basket of stocks. They take a while the wake up in the morning. Theyre a bit groggy when they roll out of bed. Because it could account for a thousand different individual stocks that will open at different times in the first minutes of trading. Also avoid closing near the close. Bid and offer spreads tend to widen. Pricing can be more volatile. So if you trade near the open or the close, you can avoid these risks. Of course, the other way you can avoid these risks is not to trade them. Absolutely, tyler. So the other bit i would add is to use limit orders. They allow to you name your price and you will get your price or better. Do not use market orders which will subject you to the whims of the market. Do not use stop loss orders which become market orders at the worst possible time. If you dont need trade, if you dont want to trade, index mutual funds are a perfectly good time. Ben johnson. Coming up, the art of the pitch. The most important moments of a startups life. Global arts sales fell to the lowest point. Sales of antiques dropped 11 to about 56. 5 billion last year. That drop informs will a 7 decline in 2015. And wyomings out all the games from the previous two years. The report cites check and political volatility from the decrease in sales. Aspiring startups are looking for the next big thing. The pressure was on. You just have your ideas in english and it turns into automated trading. In a standing room only location in mountain view, 120 startup founders have two minutes to make the pitch of their lives. Were going to make the internet so cheap, so affordable and so accessible that everyone of those 800 million will be able to pay for it. In the audience, five hunt of sill cone valleys top investors clamoring to find next big thing. Im here to see the latest and greatest. The culmination of the valleys pre eminent accelerator program. Since its founding in 2005, the companies are worth 80 billion. Some of the most successful graduates include air b b, drop box, strike. When you get a couple days, you get immersion in a hundred ideas, what people rthing. The batch in this round includes startups like this one that builds software for office management. Bright Electric Building an electric plane and fix which cause itself the uber of car repair. They have seen thousands and thousands of the smartest minds in the world. Just to get here is an accomplishment in itself. 7,000 startups send applications. The ones who make the cut spend three months in Silicon Valley developing their companies. Michael says the immersive name of the program is the key to its success. We put he have one together in a batch. What that does is it makes everyone Work Together and help each other. When you have a bunk of people working really hard, you work even harder. The two companies, twitch and social cam, sold for a total of more than 1 billion. And an end game they hope will be theirs as well. Why Officials Say some Companies Get funded right away. For others it could take months. Heidi and twitch. That sounds like a sitcom. Have a great evening. Does that mean im twitchy . Nightly Business Report has been fund in the part by all it takes is a spark. One idea to take flight. The courage to seek the unknown. To innovate, disrupt, to move us all forward. To explore a different perspective. At nasdaq, we connect the world, its ideas, its capital, its businesses, the people that drive global economy, the future isnt tomorrow. Its right now. All it takes is a spark. Nasdaq