Delightful. Companies are hiring. Optimism is high. The dow and the nasdaq recorded their best starts to a year since 2006. And todays not too hot, not too cold employment report helped drive all of the major indexes to fresh records, again. The dow jones industriae advanced 220 points to 25,295. Nasdaq added 58. And the s p 500 was up 19. For the week, all of the major indexes posted solid gains. And with those gains comes an increase in stock market optimism which we should point out is not always a good thing. Bob pisani reports tonight fro reporter the december jobs report was below expectations and the markets seemed relieved. Why would they be relieved . Because the economic reports have been so strong recently, the traders are beginning to worry that the Federal Reserve might be more aggressive, raising rates to slow down an overheating economy. But todays jobs report was just about perfect. It was still strong. It wasnt as strong as the experts thought it would be. So it reduced the chances the fed would get concerned about an overheating economy. The markets are at a critical juncture right now. The markets have had a big start, the s p is up 2 the first week of the year. Everything seems to be up. There are some signs traders are getting euphoric. A lot of people seem to believe that the economy and wages and earnings are really going to take off in 2018. Thats a little bit worrisome, because warm front best things that the markets had going for it in the last seven or eight years is just how hated the rally has been. Weve talk about a lot. For you people are starting to like the rally. And some people are starting to rally a lot. And that makes a lot of people, including me, a little bit nervous. Now, next week earnings season starts, and expectations are very high. Traders arent just expecting earnings to beat expectations by a few pennies. They want a lot more than that. They want more buybacks. They want more capital investment. Th want kind of like the whole enchilada. Yo see what i mean . With expectations this high, the markets will likely have some issues delivering. For nightly business r im bob pisani at the new york stock exchange. That december jobs report that bob just mentioned saw the pace of hiring slow in the final month of 2017. But it capped a strong year overall for the labor market. In december, nonfarm payrolls rose by 148,000, which was below expectations. The jobless rate remained steady at 4. 1 . That made last year the seventh Straight Year where employment gains exceeded 2 million. Its only the second time in recent memory that the economy has produced jobs at that pace for that long. Hampton pearso takes a look at reporter while there was a winter chill to the pace of hiring in december, job growth in the last three months of 2017 averaged more than 200,000 new workers added to payrolls each month. At 4. 1 , the Unemployment Rate is the lowest since 2000. December even saw a slight increase in wages. Average Hourly Earnings up 2. 5 year over year, now just under 27 an hour. We think they continue to grind higher, maybe a little closer to 3 by the end of this year. If youre looking for a takeoff moment, thats probably not what it all adds up, leading economist predict, to a wait and see approach from incoming fed chairman jay powell and monetary policymakers when it comes to tracking interest scares anyone and makes them want a hike any farther faster than they otherwise would. Theyll err on the side of caution. Right now the fed doesnt mind if inflation runs a little bit hotter and people get wage n a s. Led the way in job gains in december, adding 30,000 and 25,000 new workers respectively. The Unemployment Rate for africanamers rea a record low of 6. 8 last month, down a full percentage point over the last 12 months. 87 months of continuous job growth is an outstanding trend. And to see the africanamerican Unemployment Rate down below 7 where it had been in the 15 range is very good news. Other the biggest job losses occurred among retailers, cutting 6,700 for all of 2017. Will the pace of hiring continue to slow down as the labor market nears full employment . Or could job growth get a boost from the businessfriendly 1. 5 trillion tax cut package signed into law by President Trump just last month . For nightly business rep mp. Joining us now to discuss the reports findings in more detail is michael gapen, barclays chief u. S. Economist and a managing director there. Michael, welcome and good to have you with us. This was a little bit of a slowdown in job growth. But still, Unemployment Rates staying right where they are, earnings coming up a little bit. Is there any nit to pick here . Not really, i agree with much of the leadin that you just had. A lot of slowing can be explained by a posthurricane return to normal. If you look back a few months, when the large hurricanes hit the u. S. , hiring virtually stopped in the month of september, and we had some catchup to do in october and november. At above trend in terms of hiring in those two months. So some slowing and a return to normalcy was expected. I think that was part of the story. And then i think the other factor was just an outsized decline in the Retail Sector as you just mentioned. But thats not a new story either. Online retailing has been taking an evergreater share of that type of transaction, and weve seen a reduction in employment from traditional brick and mortar stores. That largely accounted for the underperforman the rest of the report looked good. I think hiring will continue at a robust pace through the remainder of this year. Michael, how do you feel about the gain in Hourly Earnings . The Unemployment Rate as low as it is, and the fact that companies are getting a big tax break, americans are getting a tax break, a lot of people feel as though wages will start to accelerate. We had a. 3 increase. How do you feel about that . This has been a bit of a conundrum where the Unemployment Rate, as you mentioned, is reaching lows. Wages will pick up. I suggest to look at this in the slightly broader context that more than just labor scarcity determines wage growth. Inflation has been soft and productivity has b slow. Wage growth is about where it should be when you account for those. I think it will approach 3 by the end of the year, so i think its just going to take a little bit more time. But it will still be subpar relative to prior recoveries. I know that veering you off into market talk is maybe not what you do, but are you concerned at all that there is a little too much euphoria in the economy . Things are quite good, both domestically and abroad. We often focus on the u. S. Exclusively, but growth outside the u. S. Has been quite good for the past four quarters and even accelerated. Globally, virtually every industrialized economy is growing. And were benefiting from that as well. I do kind of believe were priced to perfection here. The biggest risk to asset markets or the equity market would be if wages picked up in a meaningful way and inflation did begin to rebound. Then you would bring the fed into play. But right now things do feel goldilocks, as yomentioned, it was a not too hot, not too cold employment report and thats what markets are reacting to. Thank you, michael. As we reported, manufacturing was one of the indust that led the way in job gains in december. In fact, that sector has added more than 200,000 jobs over the past year. Its a remarkable turnaround for an industry that was beaten and bruised not that long ago. But there is another problem, and it is a worker shortage. And nowhere is that more evident that in one manufacturer in burns harbor, indiana. Kate rogers repo i will be the greatest jobs president that god ever created. Reporter donald trump campaigned as a jobs creator with a promise to revive american manufacturing. Since the election, manufacturers hav added 171,000 jobs, encouraged by deregulation and Corporate Tax cuts as well as stronger Global Growth and a weaker dollar. But this job growth is facing one major headwind, a shortage of skilled workers. Its particularly evident in indiana where 20 of all workers work in the industry. It creates issues in trying to get people to come to intown wo work here. Reporter the idea of financial incentives to lure workers to the Hoosier State has been floated. It is estimated our workforce population is going to grow by 1 between now and 2040, and the National Average is going to be 18 . Reporter its an issue steel makers know all too well. This company employs 18,000 workers in the u. S. And is looking to add an additional 1,000 employees in 2018. But attracting talent in a tight labor market can be challenging, which is why the Company Created its steel worker for the future program. Its a partnership with heil graduates. We assist them with their College Education and also provide for them the opportunity for handson training in our factories. Rep the steel maker currently has 144 students enrolled. Dontre brooks is a recent graduate. They were talking about big name college universities, going there four plus years to get a degree. This les half the time, guaranteed job, training in a craft. I knew i had to go for it. Reporter the company is recruiting heavily and hoping to usher in the next generation of talent like brooks. This is the number one job out there. Reporter for nightly busine im kate rogers in burns harbor, indiana. Benefit as washington continues to push deregulation. The trade deficit rose more than expected in november to a sixyear high. The gap widened to more than 50 billion as imports of goods surged to a record. Part of the rise due to price increases. The white house says a smaller deficit along with tax cuts could increase economic growth. The white house will reportedly ask congress to approve 18 billion in funding for a proposed border wall along the u. S. mexico border. As first reported by the wall street journal, the request would cover construction of a wall over a decade. It will be discussed at a camp david meeting this weekend attended by the president , cabinet members and congressional leaders. We just talked about the need for workers in the manufa industry. The same is true these days in construction, where builders are looking to hire like mad to meet demand for new homes, apr buildings. All signs point to a very big year in construction. He diana olick reports, theres reporter cl at it the year f the crane. Commercial and Residential Construction are set to soar this year. And the hiring and spending has already begun. Even in december, with much of the nation frozen, the Construction Industry added 30,000 jobs, according to the labor department. For all of 2017, construction added 210,000 jobs, a 35 increase. Construction spending is also soaring, rising more than expected in november to a record 1. 26 trillion, according to the commerce department. Spending increased across all sectors of real estate, commercial and residential, with particular strength in private construction projects. Even contractor optimism is up, to the highest on record. Threequarters of construction firms say they will hire more workers year. The only trouble will be finding those workers. Theres a severe shortage of skilled Construction Labor for buildings, infrastructure, and especially for residential housing. This as demand for housing heats up, supplies sit at record lows, and builders are cashstrapped. The cost of construction is going up rap because of repairs and the shortage of supply in the Single Family precio will come through and youll see wage gains because of acute labor shortages. Reporter expect those gains to be passed on to buyers in everhigher home prices. For nightly business r m diana olick in washington. Brazil says no to a potential merger between boeing and umbrer. Boeing is working on easing government concerns over a takeover of its rival. Brazil can veto any deal. Braz said it would welcome a partnership between the two companies but nothing involving any change of ownership of umbrer. Boeing shares took off, rising 4 to 308. 84. Shares of umbrer fell to 25. 76. An 80 million payout tied to an antitrust dispute caused cal main foods to report a loss, along with missed expectations. Th egg producer said it would of 2018. Dividend for the fi cal main shares got crushed, down nearly 7 to 40. 80. Constellation brands reported a worse than expected drop in sales as fewer customers bought wine and spirits. The Company Expects that weaker demand to continue, saying sales for those products would be at the low end of initial guidance. Constellation brands hiked its overall profit forecast and said it was launching a 3 billion share buyback. Nonetheless shares were off 2 to 219. 88. Deutsche bank says it expects to report a small net loss for 2017 following new tax legislation and low levels of client activity in the latest quarter. Ni to report a profit for the full year 17. Investors disappointed, shares down 6 , 18. 55 the close. Barnes noble shares continue to fall today following the retailers announcement late yesterday that its holiday sales werent very merry. The company now expects store sales year to be down in the midsingle digit range. The bookstore giant pledged to keep its costs under control. Shares off nearly 14 to 5. 60. Time now for tonights market monitor, who has three stock picks he says will likely benefit from deregulation. They all pay a decent dividend as well. Last time he was on in april, he picked bce media, up 4 . Ppo corp. , down 18 . And abve, which was 57 higher. He is the chief market at bruderman brothers. Ni to ha you back. Thanks for having me. Deregulation and good dividends, thats theme. Your first stock is Royal Dutch Shell. Whats the dividend like . Well, the dividend is pretty good. Its above 5 . And more importantly, as president trum Just Announced that he is planning to open up offshore drilling, explorers like Royal Dutch Shell are really going to win in this. This is going to take some time. Through that speculative process, as to whether it happens or not, these shares are likely to climb solidly. Its a strong company, good dividend, in a Good Environment where growth is picking up globally. Verizon is your next pick, a very competitive space in which verizon operates, obviously. But you think the repeal of Net Neutrality will make verizon a winner. How and why . Amongst others, but verizon is somebody thats pushing out content, and theyre able to raise prices. Theyre the Market Leader out there, both in terms of cellular but also Business Services that they offer. So from our perspective, if we have to pick one, and were obviously diversified in the Telecom Sector like all other sectors, we think that verizon dividend, above 4 . It has a that dividend theme is very us. Speaking of competitive spaces, the retail industry, online and brick and mortar, you like walmart. Why . Yeah, the tax cuts are going to benefit walmarts key constituents, key customers. We think theyll pick up a pickup in sales there. We very much like their acquisition last year of jet. Com. That mak them competitive against amazon in certain areas. So we think that walmart is attractively priced. The dividend isnt great, but at 2 its not bad either. Again, we think that stock is going to do fairly well in 2018. These are real bulwark kind of companies, oliver. Are you worried at all that euphoria is getting a little out of control . I dont know if i would use the term euphoria. There are some strong fundamental reasons why the markets are trading where they are today. It doesnt mean theyre cheap by any measure. What im worried about and what wer spending a lot of time looking at, is where the performance diverge is going to come from next year. Youre going to see certain sectors do very, very well, and other sectors not do so well. You know, you saw that last year with utilities. The first half of the year, utilities did ver well. The second half of the year, they did very poorly. We think a similar type of perf metrics will come through this year. Oliver, thank you so much, have a wonderful weekend. To read more about his stock picks, head to our website, nbr. Com. Coming up, one startups new prescription in the pharmacy business is tonights new id. An update on a story weve been covering for you, apple plans to release a patch for the safari web browser for its iphones and ipads within days. This to cover a flaw in cheips used in pcs and phones and uber cofounder Travis Kalanick reportedly plans to sell a third of his stake in the ride hailing service. Hell sell 29 of his uber stock. He had long boasted that he never sold one share of the company he started. The stock sale comes as a Japanese Firm softbank prepares to buy a stake in the company. Did you ever find yourself wondering how much your medicine will actually cost when you go to the pharmacy or try to discuss Health Issues with other customers when youre there . Prescription drugs is a 400 billion plus business in the u. S. But only 1 is conducted online right now. One new york city entrepreneur got the bright idea to relieve some of the pain points with a digita reporter when eric went to his drugstore to pick up a Prescription Medication in january of 2015, his headache was just beginning. He waited in line nearly an hour before speaking to a pharmacist. He said im so sorry, were out of stock of zpack. Im thinking, its january, this is the only thing that pharmacies should have, i cant belie this an experience that exists on every Street Corner in america. Reporter its a problem thats getting worse. 42 of the respondents in a 2016 survey said their pharmacy was out of stock at least once, causing them to make a return trip, up from 33 back in 2013. Struck by his own frustration and pulling on his background as an investor in the health care, ro, a technol fields, he came up with a concept for an online pharmacy. He refined it with an old friend, pharmacist sonia patel. Most pharmacies are built on technology from 20 years ago. It didnt work for the pharmacies and didnt work for the consumer or for doctors. Reporter they found they needed better communication tools, that pharmacies have to improve inventory systems and that customers want transparent pricing. Aiming for solutions, they opened capsule in the spring of 2016. Availae only in new york city, customers can order online or ask their doctors to do it for them. The company says tens of thousands of people and thousands of physicians are using capsule. Like other pharmacies, capsule negotiates prices with wholesalers and takes a cut from the retail sales. Capsule does not discuss whether its profitable just yet. Customers can pick up in person in manhattan most opt for free delivery. Couriers brave elements to deliver anywhere in new yorks five boroughs. Dr. Dobrow isnt telling patients to shop for medications these days. Hes doing it himself. Hes finding medications at less than half the price his pharmacy manager gets at cvs. Two out of five were wildly mispriced. I imagine what the average consumer has to do with. They try to find the cheapest price they can across the market. The pbms are looking at a bundle of medications. It may be several thousand medicine. For the insurance company, the bundle is lessexpensive. But for an individual consumer one pick drug may be much more expensive. Reporter capsule alerts its customers when it beats the insurance companys price. But the company prefers not to be called an independent pharmacy. It big plans. We will absolutely expand the business nationally and internationall over time. We think the business works everywhere. Confie that comes from experie like the one sonia patel had, texting with a customer only weeks after capsule opened. She said, hey, sonia, can i take iron supplements while im pregnant . And then there was this dot dot dot, by the way, is it weird youre the first person im telling im pregnant . My husband doesnt even know yet. We had this amazing moment of, wow, we built this experience that people have an incredible degree of trust in. Pharmacists have long ranked high in surveys of the most trusted professionals. But capsule views health care as an ecosystem and its hoping to help doctors, insurance companies, drug makers, and patients work more effectively together. Before we go, at todays rally on wall street. Nasdaq added 58 and the s p 500 was up 19. Weekly gains were strong and the dow and the nasdaq had their best start to a year since 2006. Thats a good way to start the weekend. Very nice start to the year. That does it for us tonight. Im sue herera. Thanks for joius. Im tyler mathisen. Thanks from me as well. Have a great weekend, everybody. Stay warm. Well. This is bbc world news america. 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