Nightly Business Report – February 13, 2019

ANNOUNCER:  This is NIGHTLY BUSINESS REPORT with Bill Griffeth and Sue 

Herera.  

SUE HERERA, NIGHTLY BUSINESS REPORT ANCHOR:  Fear of missing out.  The 

stock market is having the best start of the year in decades, but don`t 

sweat it if you missed it.  

BILL GRIFFETH, NIGHTLY BUSINESS REPORT ANCHOR:  Hands on health care.  Your 

local drugstore may soon get a makeover making it less like a retailer and 

more like a wellness center.  

HERERA:  Deep in debt.  The U.S. government owes a record amount of money 

as do American households.  

Those stories and more tonight on NIGHTLY BUSINESS REPORT for Wednesday, 

February 13th.  

GRIFFETH:  And we do bid you a good evening, everybody, and welcome.  

Yesterday`s rally in the stock market continued today as Wall Street still 

monitors the progress of the spending bill in Washington designed to 

prevent another government shutdown and those trade talks taking place in 

Beijing.  The sense is that if a deal is reached between the U.S. and China 

without any more tariff increases, that would reduce about growth and 

perhaps allow the rallies to continue which it did today.  

The Dow gained about 117 points back to 25,543.  The Nasdaq was up five and 

the S&P gained eight.  And we`ll have more on the U.S./China trade talks in 

just a moment.  

But we begin tonight with a closer look at the sharp market rally that we 

have seen so far in 2019, at how far the major indexes have come in such a 

short period of time.  Just since the lows of December 24th, the Dow and 

the S&P are up nearly 14 percent, the Nasdaq has gained roughly 17 percent.

HERERA:  And that is leading some to fear that they have missed out on the 

rally.  But did they?

Jeremy Siegel, finance professor at the University of Pennsylvania`s 

Wharton School of Business joins us now to talk about that.  

Good to see you, Jeremy, as always.  So, I guess — 

JEREMY SIEGEL, UNIVERSITY OF PENNSYLVANIA WHARTON SCHOOL OF BUSINESS:  Good 

to be here, Sue.

HERERA:  So, I guess that is the question.  Have they missed out?  What are 

your expectations as we go further into this year?  

SIEGEL:  Well, certainly, you missed out.  There was an incredible 

Christmas Eve sale on December 24th.  I think we all wished, my God, we 

could have gotten the great bargains.  I think we have seen — as you said 

15, 16 percent.  I mean, we have seen a big increase since then.  

I think most of the increase is behind us now.  I do think we`re going to 

have an upward tilt to the end of the year, but it`s not going to be a 

runaway.  I don`t think people say oh, my god, I have to get in.  

Otherwise, I`ll going to miss a big rally.  

GRIFFETH:  You know, I think it was John Templeton who said you`re never 

going to sell the absolute top of a market.  You`re never going to buy the 

absolute bottom of a market.  You might as well say in the market and 

eliminates this fear of missing out.  

What do you think about that?  

SIEGEL:  Oh, I mean, I have been advocating that for years.  I mean, if we 

let our emotions take hold of us, we`re going to sell at the bottom and 

we`re going to all going to buy at the top which, of course, is exactly 

opposite which one to do.  Plan long term.  

And, by the way, I think long term values are there.  This market is — 

it`s certainly not as undervalued as it was last December but it isn`t over 

overvalued.  

So, certainly don`t shy away from the market as a result of this rally but 

I don`t think you have to go head over tail end and say oh, my God, it`s 

going to be another 10, 15, 20 percent.  I think it has struggled.  They 

have this year`s earnings that are certainly not anything like last year`s.  

And we still have of course the trade and, you know, political 

considerations coming in front of us.  

HERERA:  And that headline risk could create a lot of volatility.  I mean, 

we have already seen that happen, but we`re coming up once again against 

another deadline and the trade talks are inching closer to an agreement.  

But we certainly aren`t there yet.  

SIEGEL:  Yes, and I think — I think the market is 90 percent certain that 

there`s going to be an agreement.  And I think they`re right, which means 

if we get one, we`ll see it pop.  But it won`t an enormous pop.  I expect a 

five or six point rally in a few days and then it`s going to have to 

contend with a lot of other worries into the market.  

In other words, it would be very shocked if we — if Trump imposed 25 

percent tariff and we head into the trade war I`m afraid we`ll so a bear 

market.  But we will see a pop on a settlement.  Of course, we have to 

expect that Trump had talked about maybe we`ll delay the March 1st 

deadline, so we have to be prepared for that.

HERERA:  Right.

SIEGEL:  A pop, but not a huge upward surge.  

HERERA:  And on that note, Jeremy Siegel, thank you so much.  Jeremy is 

with the Wharton School of Business.

GRIFFETH:  Now to the trade talks and today, there were encouraging signals 

from both sides about the negotiations.  Back we go to Eunice Yoon in 

Beijing tonight. 

(BEGIN VIDEOTAPE)

EUNICE YOON, NIGHTLY BUSINESS REPORT CORRESPONDENT:  “The South China 

Morning Post”, the Hong Kong newspaper is quoting sources as saying that 

President Xi Jinping plans to meet with Treasury Secretary Steve Mnuchin 

and Trade Representative Robert Lighthizer possibly Friday as a goodwill 

gesture for the trade talks.  Mnuchin and Lighthizer are here to meet with 

the Chinese vice premier on Thursday and Friday.

And today, Mnuchin told reporters that he hoped that the conversations 

would be productive.

“The Wall Street Journal” is reporting that the negotiators are focused on 

drafting a framework of an agreement that can be signed by Presidents Trump 

and Xi at a possible summit, though it`s still unclear how much the sides 

can narrow their differences.  The market cheered the rallies on news that 

President Trump was open to extending the March 1st deadline.  The Chinese 

would likely welcome an extension since Trump administration officials have 

said in the past that the March 1st deadline was a hard deadline.  Without 

that pressure, the Chinese would be able to keep on talking and some 

American business people would argue, without taking much action.

For NIGHTLY BUSINESS REPORT, I`m Eunice Yoon in Beijing.  

(END VIDEOTAPE)

HERERA:  And now to Brexit, which many economists and strategists consider 

a potential threat to global growth.  Ford reportedly told the British 

prime minister that it may have to move some production out of the U.K. if 

a deal is not reached that would provide Britain with a smooth exit from 

the European Union.  

And with the deadline to reach a deal fast approaching, Willem Marx is in 

London and he takes a look at where things stand.  

(BEGIN VIDEOTAPE)

WILLEM MARX, NIGHTLY BUSINESS REPORT CORRESPONDENT:  For British Prime 

Minister Theresa May, time and parliament repeatedly proved to be part of 

the same paradoxical equation.  So the less time she has, the more 

challenges parliament provides, with an exponentially increasing threat 

from allies and enemies alike.  

JEREMY CORBYN, LABOUR PARTY LEADER:  The government`s handling of Brexit 

has been costly, shambolic and deliberately evasive.  

MARX:  They`re now remain slightly more than six weeks until Britain hits a 

two-year deadline designated for its departure from Europe, and the prime 

minister`s critics claim she wants to use that hard out as a pressure 

tactic both at home and abroad.  It was a month ago that May suffered a 

crushing House of Commons defeat.  

UNIDENTIFIED MALE:  So, the noes have it.  The noes have it.  

MARX:  But the factual complexities that currently coursed through this 

country`s fiscal veins have continued to function as a form of life 

support, at least until now.  

After another two weeks of talks here in Westminster, in Brussels, in 

Belfast and in Dublin, the prime minister has acknowledged she needs more 

time to find a negotiating breakthrough.  That apparent lack of progress is 

once more prompted a barrage of criticisms and accusations from her 

political opponents.  

IAN BLACKFORD, SCOTTISH NATIONAL PARTY:  This is the height of arrogance 

from a government set on running the clock down.  Just 44 days from a no 

deal scenario, the prime minister is hamstrung by her own party and 

rejected by European leaders.  

MARX:  But her approach with the Europeans does have some support.

GREG HANDS, BRITISH CONSERVATIVE PARTY:  They said they`ve been waiting for 

months for a determined view from London.  Well, they got that determined 

view.  I think Theresa May has rightly asked for some more time to see if 

she can get a deal with Brussels.  

MARX:  So far though, Brussels refuses to budge from the position it first 

took up many, many months ago.  Tomorrow will bring yet another day of 

Brexit debate and voting.  And in a sign of the mathematical conundrum May 

faces, some of her conservatives are again threatening to rebel against 

their leader.  

For NIGHTLY BUSINESS REPORT, I`m Willem Marx in London.  

(END VIDEOTAPE)

GRIFFETH:  Back here.  Dow component Cisco (NASDAQ:CSCO) reported better 

than expected results today, thanks to its application software and 

cybersecurity businesses.  The company said it earned 73 cents a share.  

That was one cent better than estimates.  Revenue rose from a year ago to 

more than $12 billion.  Cisco (NASDAQ:CSCO) also increased its dividend, 

and investors obviously liked sending the stock higher in initial after-

hours trading.  

HERERA:  This earnings season is in a home stretch.  And so far, so good.  

Mostly.  

Dominic Chu explains.  

(BEGIN VIDEOTAPE)

DOMINIC CHU, NIGHTLY BUSINESS REPORT CORRESPONDENT:  It`s almost over.  

Nearly three quarters of all S&P 500 companies have reported their results 

so far and so far, it`s been a generally good story.  

According to data from Refinitiv, 71 percent of companies have beaten 

average analyst estimates for earnings and 62 percent have beaten the 

average revenue estimate for analysts as well.  That has some experts 

feeling good about the health of corporate America.  

BRYCE DOTY, SIT INVESTMENT ASSOCIATES:  We are predicting that growth to be 

at least 2.5 percent which is I think is a little better than most.  I 

think people are going to be surprised.  

CHU:  If every company left reports earnings in line with analyst 

expectations, the S&P 500 will see nearly 17 percent earnings growth and 

around 6 percent revenue growth.  That`s the good news.  The bad news is 

last quarter was so good, it will be tough to top this year.  

MARK YUSKO, MORGAN CREEK CAPITAL MANAGEMENT:  I think we`ll have negative  

I think we`ll have negative year over year earnings growth.  Part of that 

is a little bit unfair because we had, you know, the steroid-induced year 

last year which was crazy because of the tax reform.  

CHU:  We`re already seeing some signs of increasingly pessimism.  In 

October of last year, Wall Street analysts were predicting that the 

earnings growth in the first quarter of 2019 would be solidly positive and 

fast forward to today and they`re predicting a slight earnings decline.  It 

could make for a more volatile market when the next earnings season kicks 

off in mid-April.

For NIGHTLY BUSINESS REPORT, I`m Dominic Chu.  

(END VIDEOTAPE)

GRIFFETH:  Time to take a look at some of today`s “Upgrades and 

Downgrades”.

Freeport-McMoRan was upgraded to overweight from equal weight at Morgan 

Stanley (NYSE:MS), with the analyst citing an improved outlook for copper 

prices.  Price target is now $14 and that stock rose nearly 7 percent today 

to $12.29.  

Lattice Semiconductor (NASDAQ:LSCC) was upgraded to positive from neutral 

at Susquehanna.  The analyst cited the company`s better than expected 

quarterly guidance which it issued last night and it ran counter to the 

weaker environment we have been seeing for semiconductor stocks more 

generally.  Price target for Lattice, $11.  That stock rose 29 percent 

today to $10.60.  

HERERA:  Still ahead, hitting the gas.  

(BEGIN VIDEO CLIP)

PHIL LEBEAU, NIGHTLY BUSINESS REPORT CORRESPONDENT:  Why is BMW gearing up 

for a big 2019?  I`m Bill LeBeau in Thermal, California.  That story is 

coming up on NIGHTLY BUSINESS REPORT.

(END VIDEO CLIP)

(MUSIC)

HERERA:  Johnson & Johnson (NYSE:JNJ) is buying Auris Health for about $3.5 

billion.  The acquisition pushes J&J further into the healthcare robotics 

market.  Auris` flagship product is a robot used by surgeons remotely.  

Auris` focus is on lung cancer and respiratory procedures.  Shares of J&J 

rose in today`s session.  

GRIFFETH:  Well, CVS (NYSE:CVS) is starting to use its merger with Aetna 

(NYSE:AET) to try and change the definition of the drugstore.  The company 

is turning some of its locations to what it now calls health hubs, offering 

more services and health-focused products.  

Bertha Coombs takes us to one in Spring, Texas, tonight.

(BEGIN VIDEOTAPE)

BERTHA COOMBS, NIGHTLY BUSINESS REPORT CORRESPONDENT:  More than half of 

the new CVS (NYSE:CVS) health hub concept store is devoted to health care.  

With more space for many clinic services and walkers, as well as a wellness 

studio, where customers like Jacqueline Haynes comes in for yoga classes 

and get one-on-one advice on managing their health.  

JAQUELINE HAYNES, CVS (NYSE:CVS) CUSTOMER:  They also have a program where 

they have a dietitian.  And that dietitian would meet with you for free and 

so she`s teaching me about my blood pressure, because I do have hyper 

tension.  

COOMBS:  Along with the dietitian, health hub has a respiratory therapist 

and new products to treat sleep apnea, a breathing disorder that can lead 

to other health issues. 

DR. ALAN LOTVIN, CVS (NYSE:CVS) HEALTH EVP OF TRANSFORMATION:  Sleep apnea 

is one of the least or most undiagnosed opportunities.  And so, we have a 

respiratory therapist and the nurses collaborate we can screen and then 

provide and fit masks and machines, teach people how to use them, so 

closing that loop around a condition that a lot of Americans have.  

COOMBS:  CVS (NYSE:CVS) isn`t the only one experimenting with hands on 

health care.  Some of their large insurance rivals like Cigna, United 

Health and Humana (NYSE:HUM) have programs where they reach out over the 

phone to members who have hypertension or diabetes to try to get them to 

help manage their care.  Or send in help at home after a patient has been 

discharged from the hospital, sometimes in conjunction with Walgreens on 

some programs.  

But CVS (NYSE:CVS) is trying to bring all of those services here at the new 

health hub, CVS (NYSE:CVS) is reaching out to the insured Aetna (NYSE:AET) 

members with diabetes, hyper tension and heart disease to come into the 

store for health coaching services.  

KEVIN HOURICAN, CVS (NYSE:CVS) PHARMACY PRESIDENT:  We`ve been pleasantly 

surprised at how many of our pharmacy customers when offered the dietitian 

services have said yes.  

COOMBS:  In the first month, more than half like Jacqueline have acted on 

new health changes.  

HAYNES:  It`s one-stop shopping for my health.

COOMBS:  The yoga classes and initial consultations are free.  But 

diagnostics services and medical equipment are billed through insurance or 

paid out of pocket.  Executives admit it`s early days and they`re trying to 

figure out just how to get the mix right.  

For NIGHTLY BUSINESS REPORT, I`m Bertha Coombs in Spring, Texas.  

(END VIDEOTAPE)

GRIFFETH:  And to read more about CVS` health hubs and what others in the 

industry are doing, you can head to our website.  Read about it at NBR.com.  

HERERA:  Hilton is raising prices and that`s where we begin tonight`s 

“Market Focus”.  

The hotel operator is charging more for rooms and that helped the company 

report better than expected quarterly profits.  Hilton cited healthy demand 

for travel, though it did point to a possible deceleration per room this 

year due to concerns over global growth.  Hilton shares were up just about 

7 percent to $79.37.  

Dish Network missed earnings expectations but revenue came in above 

forecast.  The satellite TV operator also lost more than 300,000 

subscribers last quarter, thanks in part to carriage disputes with HBO and 

Univision.  The number of subscribers fell below 10 million for the first 

time in 15 years and shares plunged more than 7.5 percent to $28.86.  

Teva Pharmaceuticals posted weaker than expected fourth quarter earnings.  

The drugmaker also and cited competition from generic drugs for its 

blockbuster multiple sclerosis drug Copaxone.  Teva shares plummeted over 

7.5 percent to $17.63.  

GRIFFETH:  T-Mobile and Sprint executives were on Capitol Hill today 

answering questions from lawmakers about their proposed $26 billion merger.  

The CEO of T-Mobile defended the get together saying it will not hurt 

consumers or jobs.  

(BEGIN VIDEO CLIP)

JOHN LEGERE, T-MOBILE CEO:  The outcome of this merger will be a 

significant increased in supply in the form of eight times the capacity 

that our network will make available.  It will bring in 87 percent decline 

in the price per gig of data and jobs will go up.  So, this is dramatically 

different.  

(END VIDEO CLIP)

GRIFFETH:  And shares of both companies fell a fraction in today`s trading.  

And late today, AIG reported a quarterly loss which was below the profit 

that analysts had been looking for.  The company cited catastrophe losses 

along with volatility in both the equity and in the credit markets.  AIG 

also announced a $2 billion stock buy back program.  Shares were initially 

lower in after-hours trading, but they finished the regular session up a 

fraction at $44.18.  

HERERA:  BMW plans to ramp up production at its sole U.S. plant this year 

to keep up with America`s growing appetite for luxury SUVs.  In fact, the 

automaker expects to build a near record number of vehicles including its 

newest model, the X7.  

Phil LeBeau reports tonight from Thermal, California.

(BEGIN VIDEOTAPE)

LEBEAU:  It`s bigger, more luxurious, it`s better, this is the golden age 

of high end SUVs.  BMW`s all new X7 hit show rooms next month as the strong 

economy adds to the appeal of upscale SUVs.  

BERNHARD KUHNT, BMW NORTH AMERICA CEO:  If you look at the SUV market in 

total, SUV market is growing and growing and growing on the premium side.  

It`s now 50, nearly 60 percent now.  

LEBEAU:  Over the last six years, luxury SUV sales have steadily picked up 

speed, thanks in part to popular models like the Mercedes GLS.  Meanwhile, 

newer and refreshed entries like the Lincoln Navigator will be added 

competition for BMW`s biggest SUV.  

JEFF SCHUSTER, LMC AUTOMOTIVE CHIEF ANALYST:  When we`re looking at the 

high end, the top end of the bandwidth, really that large seven-seater, 

there`s really about ten vehicles that this BMW X7 competes with.  

Obviously this is where a lot of profit margins are made and I think that`s 

why they`re looking to enter this segment.  

LEBEAU:  The X7 will be built at the BMW plant in South Carolina.  

Production is expected to climb this year to near record levels.  For BMW 

and other European automakers building popular SUVs here in the U.S. is 

critical to their success, especially as the White House considers slapping 

tariffs or higher costs on luxury sedans imported from plants in Europe, a 

move that would hurt sales.  

KUHNT:  Am I concerned about it?  Yes, I am, because it will have an 

impact.  If tariff goes up, it`s not good for the consumer.  It`s not good 

for our dealer network.  It`s not good for the economy in total.  

LEBEAU:  Overall, Bernhard Kuhnt believes America`s appetite for new 

vehicles remains strong.  Welcome news for the X7 rolling in to showrooms 

next month and entering a crowded luxury SUV market where buyers are 

willing to pay more than $50,000 for a new ride.

Phil LeBeau, NIGHTLY BUSINESS REPORT, Thermal, California.  

(END VIDEOTAPE)

GRIFFETH:  And those higher prices means that Americans are taking out 

bigger car loans.  And speaking of which, the word “debt” was very much in 

the news today.  First, the Treasury Department said that our nation`s 

federal debt level has now surpassed $22 trillion for the first time.  Then 

the Federal Reserve Bank of New York reported that more than 7 million 

Americans are behind on their car payments by at least 90 days.  

Finally, a new survey from bankrate.com found that roughly a third of 

Americans have more credit card debt than they do in savings.  

Joining us now to talk about the implications of all of this for the 

economy, Joe Brusuelas is back with us.  He`s chief economist at RSM.  

Joe, good to see you again.  Welcome back.  

JOE BRUSUELAS, RSM CHIEF ECONOMIST:  Thank you.  

GRIFFETH:  Do any of the numbers make your palms sweat?  

BRUSUELAS:  Well, the fact that we have got people falling more than 90 

days behind on their loans for auto loans does cause some concern.  I`m not 

too worried about the national debt.  Right now, that`s not a problem.  Nor 

should it be our concern.  

HERERA:  But longer term, is it going to be an issue for the U.S. 

especially given the interest rate environment that we find ourselves in?  

BRUSUELAS:  All right.  So, if we continue in this low interest rate 

environment it`s not going to be a real concern.  We have learned a lot 

about debt and deficit dynamics over the past 30 years primarily by 

watching what`s happened in Japan.  

Now, we don`t want to go there to around, we`re going to be 200 percent of 

debt to GDP ratios.  But should we see a resetting of interest rates back 

to what we might consider their natural level, then it would be a problem.

GRIFFETH:  What about the metric that Bank Rate talked about today that 

we`re a third of Americans have higher credit card debt than they do 

savings?  I mean, it`s happened in the past.  This is how we get ourselves 

into trouble, with higher debt than we can manage.  Are we there yet do you 

think?  

BRUSUELAS:  Well, there`s two things, one that`s classic late cycle 

dynamics.  Two, we`ve got two different economies here in this country.  

One is along the coast, aligned with tech, digital, scientific, literary, 

life sciences and the other is more traditional.  That`s the traditional 

economy, that`s where the problem is.  

And that`s where you see the middle that stokes a lot of  that stokes a lot 

of social and policy tensions around the country.  

HERERA:  If I can turn you back to the car loan issue because it`s 

essential for people to have transportation to work.  So if indeed they`re 

falling that far behind on their car loans, what are the implications for 

the economy?  And also, some of these loans are not through traditional 

bank lending.  

BRUSUELAS:  All right.  So, we`re not going to have any financial systemic 

problems because of delinquencies.  And these are made by nonbank lenders.  

And, two, other 25 percent of business cycle have been subprime variety.  

So, this isn`t something that`s largely going to be unexpected but when you 

see people fall behind like that, that`s a sign that your economy is 

slowing.  We are slowing back to around 1.8 percent which is a long term 

trend.  That`s where we`ll be here in this year.  

GRIFFETH:  All right.  We`re not at a crisis, but it`s something to keep an 

eye on.  

Joe Brusuelas from RSM, always good to see you.  Thanks again for joining 

us tonight.  

BRUSUELAS:  Thank you.  

GRIFFETH:  And coming up, farmers plow ahead despite facing challenges.

(BEGIN VIDEO CLIP)

JANE WELLS, NIGHTLY BUSINESS REPORT CORRESPONDENT:  Oh, sure, the farm 

show, it`s all fun and games.  But we`re about a year into the trade and 

tariff war and the question really is for farmers and equipment makers — 

what`s the real impact?  Do they have a tough road to hoe?  We`ll have that 

coming up.  

(END VIDEO CLIP)

GRIFFETH:  Here`s what we`re watching tomorrow.  Retail sales for December 

will finally be released.  It`s a month late because of the partial 

government shutdown.  The producer price index will give the investors a 

look at inflation pressures in the economy right now.  And Dow component 

Coca-Cola (NYSE:KO) releases its quarterly results.  

That`s what we`re watching for on Thursday.  

HERERA:  Google (NASDAQ:GOOG) plans to expand into Nevada, Ohio, Texas and 

Nebraska, and it will spend $13 billion this year to do so.  In a blog 

post, CEO Sundar Pichai said that the new locations will be both data 

centers and offices.  This is the first time Google (NASDAQ:GOOG) will have 

infrastructure locations in those states.  The company is also doubling its 

workforce in Virginia and expanding its New York campus.  

GRIFFETH:  Well, it`s been quite a year for the agriculture industry as we 

have been reporting.  Farmers across the country find themselves caught in 

the middle of the U.S./China trade war.  Something that both — that is 

both positive and negative.  

And as Jane Wells reports now it was the big topic of conversation at this 

year`s World Agriculture Expo in Tulare, California.  

(BEGIN VIDEOTAPE)

WELLS:  It is the large farm show in the West, and it`s a good place to 

take farming`s financial temperature nearly a year into the trade and 

tariff wars.  

BRADEN MONK, UTAH DAIRY FARMER:  The processors won`t take any more milk 

and the beef is not worth as much as it`s used to be.  So, it`s been pretty 

tough.  

WELLS:  Yes, large parts of the farm economy have taken a hit but it`s not 

all bad.  Lower soybean exports mean more soybeans at home to feed American 

livestock.  

ALLAN HUTTEMA, IDAHO DAIRY FARMER:  It`s helped us a bit on the input side.  

WELLS:  Here in California, exports of fresh oranges have plummeted an 

estimated 80 percent because of Chinese tariffs missing out on the popular 

lunar New Year celebration.  But that means cheaper prices for American 

consumers.  

ROLAND FUMASI, RABOBANK SENIOR ANALYST:  Orange prices are off 30 percent, 

40 percent in recent weeks versus where they were at the same time last 

year.  

WELLS:  So what does this mean for equipment makers?  These machines cost 

more due to tariffs on imported steel.  Yet, U.S. tractor sales were up 

over 5 percent in January.  

The decision that farmers have to make is after the buying boom in 2013 and 

2014, this will be the time that they would start to replacing equipment.  

Will they?  Well, they`re certainly here kicking the tires.

JOE DIPIETRO, AGCO (NYSE:AGCO) VP SALES/MARKETING NORTH AMERICA:  And 

honestly, the age of the U.S. and Canadian vehicle parts, the age of the 

machinery on the farms, it`s at a point where the farmer is needing to 

replace.  

WELLS:  Even so, Deere was downgraded to neutral by Bank of America 

(NYSE:BAC) over concerns in part about trade.  Yet, once again, most 

farmers appear to be sticking by the president as he talks trade with 

China.

BROOKS BEHLING, UTAH ALFALFA FARMER:  It does hurt.  But I think in the 

end, when things play out, it will be better for everybody.  It had to be 

done.  Things couldn`t go on the way they were.  

WELLS:  For NIGHTLY BUSINESS REPORT, Jane Wells, Tulare, California.  

(END VIDEOTAPE)

HERERA:  Before we go, here`s a look at the final numbers from Wall Street.  

The Dow rose 117 points, Nasdaq was up five, and the S&P 500 gained eight.  

And that will do it for NIGHTLY BUSINESS REPORT tonight.  I`m Sue Herera.  

Thanks for joining us.  

GRIFFETH:  I`m Bill Griffeth.  Have a great evening.  We`ll see you 

tomorrow.

END

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