Transcripts For KQED Nightly Business Report 20170727

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it was another record setting day for the s&p 500 and nasdaq. today, something new happened, the dow jones set an all time high too. sewell tell you in a minute about the specific stock that drove today's record run broadly speaki speaking, investors were cheered by two things, including the federal reserve's decision to keep rates unchanged. something we'll talk about a little later in the program. the dow jones industrial average advanced 97 points to that record 21711. the nasdaq added 10. it was enough for a new high. the stock that fueled the dow's gains was boeing. shares flew higher recording its largest percentage gain since 2008. the reason, strong quarterly results. a close to perfect report. it's profit beat expectations and the company lifted its forecast for the year sales fell, but investors didn't care. boeing churned out a lot of cash and returned billions back to shareholders boeing today surpassed goldman sachs to be the priciest stock in the dow the world's largest aerospace company is up nearly 50%. >> reporter: pardon the pun, but boeing is soaring to new heights. how much greater efficiency? last quarter, their cashflow was almost double what wall street was expectin the company's cashflow is not slowing down we still expect year over year cash growth throughout the end of the geck aid. >> the bottom line comes as the company continues to cut jobs, many of them on its assembly lines, which have become more productive, thanks in part to increased automation and relentless focus on improving efficiency. >> the company has surprised myself and a lot of people on their ability to take costs out and drive more efficiency through the factory. >> the factory that builds the 737 max will be running at its highest level ever. cranking out almost 50 of the new planes every month. with airbus aggressively pricing planes and newcomers like comack in change in a expected to do the same, boeing's long profitability still faces plenty of challenges. the good news for boeing, so many airlines have placed orders for new planes, the backlog now totals almost a half trillion. meanwhile, boeing finds itself in a profitable position, driving down costs, while increasing production with every new plane that it builds. phil lebeau, nightly business report, chicago. the fellow dow component coke reported better than expected profit. it wasn't because of strong sales of its namesake beverage, rather because of strong demand for juices and low sugar sodas, this was the first report under james quincy, and he made a big move, announcing plans to make over coke zero in the u.s. shares rose about 1% on the day. >> facebook crushed its 3r06 it and revenue business. the social media company said about 2 billion people were using its service monthly up 17% from a year earlier. revenues sored 45% from a year earlier to more than $9 billion. julia borsten has more on facebook's quarter. >> reporter: revenue and monthly active user growth outpacing estimates. cheryl sandberg telling me the company is benefiting from businesses looking to build their mobil presence. not just on facebook, but also on instagram. >> people are using our products and services to share and connect and build community on their mobil phones. we're really excited to announce today we have over 15 million businesses using business profiles on instagram, that joins our 70 million business pages on facebook. these are -- facebook and instagram are places where people are connecting with each other, but businesses are connecting with their consumer. >> sandberg wouldn't break out instagram's revenue, but are pleased with its success. as for concerns facebook won't be able to rely on upping its add low, they just want higher quality adds, to be a win win for users and brandses. i'm julia borsten in los angeles. a new $10 billion factory in wisconsin, which means jobs, potentially a lot of them. a major apple supplier based in taiwan will make flat screen displays using tv's and other products. the announcement was made this evening at a ceremony at the white house, and marks the first major u.s. investment. a decision to build a plant in the u.s. is considered a big win for the president to create u.s. manufacturing jobs scott cohn is reporting the story for us tonight. why wisconsin, and where roug y roughly. >> well, we think it's going to be the southeast part of the state this is a very heavily travelled, busy, booming corridor between chicago and milwaukee on i-94 scott walker just said they're calling it wiscon valley. the ideas this is going to be a sight for advanced 346r i ed manufacturing. wisconsin does do well in manufacturing. not so well in workforce. they're going to need a lot of workers for this. they'll draw workers from around the if you build it, they will come. >> yesterday the president told the wall street journal he talked to apple's ceo tim cook, he promised to build a number of manufacturing facilities in the u.s. which is leading people to speculate that perhaps today's announcement is what the president was do we know that? >> no, it is not what he was referring to. first of all while fw oxcon is a big supplier to apple, where apple assembles the iphone this is lcd displays, and apple is not saying anything about its plans, not confirming what the president talked about in his interview with the wall street jour by all indications this is something completely different. it is foxcon, apple is not involved. what sort of incentives did the state provide to foxcon, and why would wisconsin pay to bring a factory to a state that has extremely low unemployment to begin with. >> they don't need jobs, but they need these kinds of jobs. the numbers being talked about are in the billions of dollars, already some of the watchdog groups that follow this are calling that somewhat troubling. presumably the state legislature is going to have to work through some of this. we understand there is going to be state money, federal money and local money, we understand there are no new federal incentive programs, they're going to be drawing on existing programs. a lot to sort out, a lot of money, the thinking is, these are valuable jobs and it's important. >> next generation investment? >> yes. >> in the meantime, amazon is going on a hiring spree, the online retailer is looking to fillmore than 50,000 positions across the country. the majority of jobs will be full time, some part time jobs will be available at sorting centers. in january, amazon said it wanted to hire 100,000 full time workers over the next year and a half. amazon will host the nation's largest job fair next week at 10 of its warehouses. still ahead, who are better investors, women or men? new security measures are landing at the nation's airports. new rules for screening large electronic devices. travelers in standard security lanes will be required to place all electronics larger than a cell phone in bins for x-ray screening at all airports. there are no changes to what people can bring through those lanes. >> the senate rejected a republican effort to repeal the affordable care act with a two-year delay. late yesterday, a separate measure which would have repealed parts of the law came up short as well. this morning, mitch mcconnell urged lawmakers to get it done. >> this certainly won't be easy. hardly anything in this process has been. but we know that moving beyond the failures of obama care is the right thing to do. we put a lot of hard work already into this. we've had important successes like we saw with the vote to proceed yesterday. we have to keep up the work now so we can get this done. the skinny repeal would leave most of the affordable care act in place as of now. the ongoing inventory shortage continued to eat into overall activity. the biggest gains were found in the west and midwest. this both saw zounl digit increases. >> builders are struggling to keep up with demand because of a rising lumber cost. >> housing is one part of the economy the fed tracks very closely. and today the central bank policy makers decided not to raise interest rates. the fed did lay the groundwork for another potentially big move. and investors are paying attention. steve liesman explains. >> the federal reserve kept interest rates unchanged in this july meeting. it signaled it will likely begin reducing its balance sheet as soon as september. unwinding its massive stimulus program from the financial cris. will begin relatively soon. the fed bought securities before and after the crisis. once it lowered its benchmark rate to near zero. the fed was generally positive on the economy. economic activity has been rising moderately. inflation is running below it's 2% goal, it had previously said it was running somewhat below. took out the word somewhat. the fed said it expects to raise rates gradually, markets doubt the chance of a december rate hike now. and the fed backed that up with its concern over inflation. they expect inflation to be moving back toward the 2% goal, that could lay the foundation for the next rate hike later this year. ford tops wall streets with's expectations. the automaker reported second quarter earnings that beat analyst's estimates. a solid performance from its credit union. much of its quarterly performance was thanks to a lower corporate tax rate which will rise slig analysts pointed out the tax rate will likely lead to lower net income than previously expected. on that, shares of ford fell 2% to 1106. tupperware beat its expectations, sales missed the mark. they said they would wind down its cosmetics business after failing to find a buyer. anthem could pull out of more obama care markets if they cut more subsidies to insurers. anthem said it expects enrollment to grow by 300 to 500,000 members in 2017. anthem fell 3%. to 184.99. hershey's second quarter earnings beat estimates, citing strong sales for easter candy. they raised quarterly dividends 6%. shares were off 1% to 106 even. six flags theme park hosted earnings and revenue that missed estimates shares rose 6% today. the nation's largest home builder d.r. horton said solid market conditions helped it beat sales the market growth was the slowest in three quarters. they fell to 36.29. northrup grumman's quarterly report came in ger than expect citing strong performance in all three areas. northrup grumman off a fraction at 263.86. after the bell, giliad sciences top expectations. the company had warned earlier this year, sales of the high priced drugs would fall, because fewer people were eligible for treatment as well as more competition from rival drug makers. giliad shares initially rose following that news. >> etf's have become very popular with investors. 15 years ago today, the first bond etf was offered. how far have they come and how far will they still go? >> a new division of bonds called i shares, they called it an exchange traded fund. even though only 4 funds were launched that day, it changed the way bonds are traded. the assets oefrn $700 billion, and most of it in the united states. that's a success by any measure. and the business is only going to get bigger. you keep more of what you earn. despite complaints that the etf business has grown too fast. they're really a small part of the u.s. equity and bond business. it's only 1% of the whole bond market and 8% of the whole market. it could get to 50% of the u.s. stock market, that could take many years, the bond business could double in the next five years. despite the attention etf's have attracted. there's a larger audience that the biggest etf providers have set their sights on. like professional asset managers. more pros will be putting more money into bond etf's in the future, as the whole bond moves toward electronic trading many it's not just because investors are shifting money into etf's, change is being forced on the industry by regulation. new rules coming out in 2018 will require the disclosure of monday markups, which will make those difficu to justify. people are going to have to explain why that's a better deal than owning a much lower cost bond etf. and now to a topic we hope won't lead to the tossing of kaiser rolls at your dinner table. why women are better investors than men are. this is what a new wells fargo report found when it analyzed more than 900,000 investment accounts between december 2010 and december 2015. tracy mcmillan is the head of global asset allocation. welcome, good to have you with us, i feel i should sit here quietly and let you and sue faulk about this, nevertheless, they're letting me lead the segment, what did the study find, how much better as investors are women than men, and why? >> what we found was an interesting dichotomy between what women say about their investing abilities and the actual performance results. what women tend to say is that they have less conference in their ability as investors, they also say that they expect lower returns on average than men do. they also tend to look toward the advice, exactly. they want more advice from their advisers, what we found was that women on average outperformed men. and they also took less risk, while they were doing that. we found they took about -- >> you found 3 things. you found three things that basically women do differently than men, and that gives them the edge. patience, discipline and the willingness to l and they trade less frequently? >> that's right. that is right, yes. exactly. and -- >> so how much -- >> what's the difference in return, tracy? in other words, was it -- they earned twice as much with x% less risk? a smith more? i need to salvage something here for my gender. >> it was actually just a little bit more than women on an absolute return basis. but when we adjusted for risk, the return was actually a little bit higher. >> and the one thing you found that you mentioned earlier is that women lack confidence. how can they basically -- not fix, but get that confidence they are doing those three things very well. how do you boost the confidence aspect? >> well, that's exactly right, women are good investors, and i think that's the message we really want to get out and we want people to know that. and we think that you can learn more about investing. by watching shows like this, and by going to investment internet sites. you can also talk with your adviser about investing to gain more confidence. and the other thing that we would suggest that women do is to know what's available to them. know what's available through your work, how you can invest in 401(k) plans and things like that. >> tracy, thanks very much, appreciate it. >> tracy mcmillan with wells fargo. corporate america faces some big cyber threats, are they doing enough to prevent them? great britain will ban the sale of new gas and diesel cars by the year 2040. britain's plan matches a similar pledge made by france. they will promote electric cars. volvo said it would phase out internal combustion engines in the coming years. >> corporate america has its guard up against hackers because the threat is growing. hackers are gathering in las vegas. aditi roy is in las vegas at a convention. >> this may look like a scene from a movie, but it's real life. the black hats cyber security conference in las vegas. and the engineering pros here are trying to ward off would be hackers. most of the 15,000 people attending the conference don't feel safe from hac. >> it's not a matter of if you'll be attacked, but when. >> one recent study shows the number of u.s. data breaches so far this year is on a record pace. almost 30% higher from this time la 50% of the attendees believe a serious attack will occur in the next few years. recent examples of state sponsored cyber attacks like allegations of election hacking to north korea's possible involvement in an attack. have eroded their confidence. part of the reason for that pessimism is that hackers are getting more potent. >> cyber attacks are increasing, because they're coming effect i don't think enterprises have the tools to handle them. >> companies are fighting back. most fortune 500 firms have chief information security officers. they report to the ceo, regularly attend board meetings and translate it needs into strategic goals. >> we've seen the elevation of some of these attacks and serious impacts on businesses. there's a desire for the ceo to have someone who owns the responsibility for security. >> companies need to do more to protect themselves. for nightly business report, i'm aditi roy, las vegas, nevada. last night we brought you a story about a wisconsin company offering to implant its employees with a chip, right here between the thumb and forefinger, we asked you what you thought of the idea. most of you thought it was a bad idea. just 5% of you said you would let the chip fall where it may. >> there you go. >> we didn't vote. we wouldn't have agreed. >> that's it for us tonight. i'm sue herera. thanks for joining us. >> have a great evening, everyone we'll see you back here . this is a bbc america. funding of this presentation is made possible by. the freemen foundation. and coal fuller foundation pursuing solutions for america's neglected me. planning a vacation escape that's relaxing inviting. and exciting. is a lot easier than you think. you can find it here in aruba. families couples and friends can all find their escape on the island

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