Boomers are learning how to trade options as they near retirement but do the risks outweigh the reward . Well have that for nightly Business Report on friday, july 12th. This was not a good day for boeing or its 787 dreamliner or the investors. Shares down 5 keeping the dow under pressure from midday on. That was when news hit that an empty ethiopian 787 dream liner caught fire at londons health row airport. Its involving a new aircraft so critical to boeings future and seth caplin says investors need to Pay Attention to these kinds of events. From a perception perspective for boeing, these things are not helpful. Investors are going to be looking for some certainty here. They will be looking for, you know, is this just the latest thing . Is there Something ElseGoing Forward we dont know about . Not helpful to put it mildly and if the fire was not enough, in a accept brett incident a Thompson Airways 787 to florida was forceed to return to britains Manchester Airport after a technical problem on board. All aboard were safe. Officials havent said what caused the problems on either plane, but investors didnt wait for an explanation. After hitting a 52week high early today, boeing shares nosedived and caught in the downdraft, some of boeings top suppliers and parts makers like spirit air systems down 2 . Coming up, the market monitor guest will say whether he thinks boeing is a good longterm investment. That news overshadowed a tugofwar on wall street today with blowout Bank Earnings battling a troubled warning from a belt weather. Well have more in just a moment. But what surprised invelst tors is ups warning profits will be lower as customers find cheaper ways to ship. They say they see a slowdown in the u. S. Industrial economy. Ups shares tumbled 6 and that news weighed down the stocks. By the closing bell stocks rebounded and even posted new records. The dow added and the s p up five points and the nasdaq added 21 points. What is behind the warning behind ups and what could it mean for the overall economy . Hampton pearson explains. Reporter the latest indicated the Global Economic recovery has a long way to go comes from United Parcel service. Ups says there is an over capacity in the global air freight market and they are looking for cheaper solutions, even if they take more time. Economists say it is bellwethers for the global economy. I do think that the slow down that we seen across the globe coming into the summer was more than anyone anticipated. I think most of the transportation companies, Delivery Companies expected better, more and had access capacity. So, you know, i think they were surprised by this. Reporter ups says its expecting profits this year to be higher than 2012, including solid growth in the second half of the year. On going labor negotiations is another factor impacting package volume growth but retail analysts view that as a shortterm problem. I think ups will rebound and will regain some or rebuild and ramp up on new customer acre session again but that was a probably soft spot in the second quarter, as well, while as shippers maybe chose fedex or ups due to those negotiations. Reporter meanwhile, ups is counting on growth in Ground Transportation and small package business in the second half of the year to offset lower profits and Slower Growth in the global air fright competition. For nightly Business Report, im hampton pearson. One bright spot in todays trading, big profits from jp morgan and wells fargo delivered better than expected quarterly earnings. Jp morgan profits surged 31 to 1. 60 a share, 16 cents more than analysts estimates. Revenue also better than expected, up 14 . Wells fargo posted a gain of 19 or 9 8 cents a share, a nickel higher and the recent jump in Interest Rates and drop off in lending in the Mortgage Market but the ceo of jp morgan said they will continue to do well as Interest Rates move higher. All equal, it may knock down Mortgage Origination but have you have a healthy economy that will filter through. All things equal, a good thing as long as the economy is growing. As for the outlook for the u. S. Economy, diamond is also pretty upbeat. The American Economy is getting slowly getting stronger, so the lending will come back when people have more confidence and do more capital investing. Were confident youll see growth over the years as america recovers. Well learn more about the outlook for the Banking Sector next week. Citi Group Reports its earnings on monday. Here to give us more analysis on those Bank Earnings today and a look ahead to next week, fred cannon, director of the Bank Research firm keith, bia and woods. Thanks. What were the highlights and low lights in jp and wells, more highlights than low . There were. Fee revenues, both companies stronger than expected and credit. These companies have big legacy asset port fo portfolios and cr tight for three years so no problems with credit developing. They are releasing reserves they made for loans and thats a key element to the growth. Fred, do you think well hear the same story line when sciti reports and bank of america . I think so. As jamie diamond said in the previous segment, this is getting to be a better environment for banking. Higher rates while there are negatives are a better thing because the spread of what you can earn on lending ver suls su cost of deposit. Home prices are drifting up in the u. S. And the recent runup in Interest Rates isnt dampening that. Those are a good backdrop for second kwaurquarter earnings. What are they doing so well . Im not talking about the big ones, though, thats the main focus tonight. What are the midsized guys doing well . Lending. If you look at the data for the second quarter, the large banks lending increase was over 1 , not great. The small banks overall was about 8 . So really, the small banks are the ones out there aggressively getting out there with customers and making loans. Thats what they do and thats why stock prices are doing well. When we look at the bank index, its been pretty much on the rise since the beginning of the year. Do you see that continuing, and are there any stocks big or small in the Banking Sector that you are recommending . We do think its a good environme environment. Interestingly, the evaluations are kind of stretched, so they get nervous at this point in time. We were up 25 year to date and after a good run last year but the key bank index is 40 below the peak precycle. A lot had to do with delusion but low Interest Rate environment keeping keeping earnings down. As Interest Rates rise and home prices go up, its a good environment. Citi is a great investment and should do well. Nervous about emerging market issues but should do fine there is a number of regional banks. You should look upstate new york to buffalo there is a couple banks that were big on right now. First niagra had a tough time. Its a good lending environment for banks because they can command more on the loan rates and their cost of securing deposits is low. Another way of saying that is they raised their loan rates but havent raised deposit rates. Do you expect them to raise deposit rates soon . No, the banks are swimming in liquidity. So we think there will be plenty of deposits around for a long period of time. If youre a saver, dont expect cds to go up thats what im asking, fred cannon, thanks very much. Director of research. Great to be on, thanks. Big changes happening in cuba. The hard line socialist government invited a select group of business journalist to get an up close look at the economy and reforms being made. So what is new and why now . Michelle cabrera is one of those journalest on the ground in havana and has the report. Reporter although the cuban government says its fully committed to socialism it invited journalists to show us what they are making changes to take the government out of the economy, individuals are allowed to no longer work for the government and instead, start their own Small Businesses in select areas. Wherever you go, you see shops in doorways and windows. But just to show you how far they still have to go, the example that the cuban government showed to the journalist was a store front where they sold religious clothing and manufactured in the back. Working on 1950 Singer Sewing machines. The owner of the shop said shes clearing 130 a month after all her expenses. Thats a lot of money in a country where the average cuban makes 19 a month. Other changes are coming in the transportation sector where they are encouraging workers to form cooperative, to try to relief the terrible, terrible situation with buses, which are packed and terrible for riders in the sweltering heat. Many are asking whether whats happening in cuba right now is similar to what happened in china in 1980 when that country began a series of massive reforms. The cuban government says absolutely not, it will still always be socialist and these changes are only to make so socialism in their words, more sustainable. Im Michelle Cabrera in havana cue back. If you want to learn more, log on nbr. Com. Tennis, bridge and options trading . Find out why baby boomers are do it yourself option investors and what they may risk in the process but first, lets look how the International Markets finished today. Soaring would prices trickled down to higher prices at the pump. Aaa reports the average price for a gallon of unleaded is 3. 55, up 3 cents from yesterday. Thats the largest oneday spike since february and expects say the pain at the pump is likely to get even worse this weekend. Toyotas popular rav4 small sized suv scored a score of good for Highway Safety but in one demanding crash test they received the worst possible score. In the socalled small over lap test which involves crashing a vehicle at 40 miles an hour into a 5foot high barrier on the drivers side over lapping a quarter of the vehicles entire width. The toprated, Subaru Forester and mitsubishi out lander. Alwian rocketed today to an alltime high. They make socalled orphan drugs to treat rare disorders. They gained 12. 5 . Also in healthcare, afina health jumped to a 20 high. This software sign add contract with a large healthcare system. Shares closed near that alltime high at 109. 75. And web md said bio farmers are buying more ads and sponsorships. Web md shares new high closed up more than 25 at 33. 82. H and r block selling to avoid stricter regulations and investors say yay and they said lets move those shares higher, which they did. New high, triple volume closing at 43. 63. After the bell at t said its belling leap wireless for 15 dollars per share in cash, a 7 premium over the closing price. Leap operates a prepaid wireless service, which at t will continue to deal subject to fcc review. Shares of at t were flat after hours as you see there, while leap shares, well they leaped. Market monitor expects the stock rally to continue for the next 12 months. Chief investment strategist at russell investments. Welcome. Thank you. We reported a bunch of new highs, this is an amazing run for the stock market. What do you think will drive stocks higher over the next 12 months . Well, a couple things, but ill go back to the source of the strength in the markets this week because of gentle ben. We didnt see he said anything new in terms of the federal reserve. What he said was the Economic News is getting better, the u. S. Economy is getting closer to not needing the full stimulus and they will consider pulling some of that back, and we think thats good news for stocks and good news for earnings Going Forward because we think that great, Economic Growth will accelerate here and in europe in the back half of this year. Plus, you know, the roads of equities to fixed income and cash is still there. Those others dont look attractive and that will probably drive multiple expansions. Good earnings and the fact that there is nowhere else to go probably drives stocks forward. As you know, eric, weve been watching viewers to send in their questions about individual stocks and well start with one right in your backyard, which i know you must be familiar with. Robert b in Long Beach California wrote in object boeing. He said i would like your analysis of boeing, the company had backlogged, controls, future products in demand and u. S. Carriers have ageing fleets. That against the backdrop of two insuran incidents that handicapped the stock. Absolutely. Why dont we hold as much of boeing as people think we might . Relative valuation of boeing versus other stocks. Boeing with todays 5 pull back which you noted earlier in the broadcast is up 35 year to date. Its actually had a very good oneyear return. We think that its a good stock, good company, just a little pri pricey at this level. Linda says saw your program for the first time tonight, we hope, linda, you keep watching. She bought sony at 12 a share and now its over 21. She wants to know sell it or hold on . What do you think . Well, thats another stock were under weight and meaning under weight. She may want to consider a company like samsung. Sony is another story of stock price is spectacular. They benefitted from being in japan where samsungs market in co correia has not done well. Lets move to missouri where matt h is interested in sea drill. He says i enjoy your show each weeknight and find it informative. Were grateful to you for that. Can you please look at sea drill ticker sdrl and tell me what the future looks like for the company and dividends. They are an offshore drilling contractor so they own oil rigs and drill off them. Businesses has been good for them since oil prices are high. In response they have taken out a lot of debt because oil rigs are expensive and significantly increased capacity, which isnt a problem on its own. The industry as a whole has done that. We think that will come under price pressure in the future because so much new capacity will come online and the other problem is debt they have taken on, hard to refinance Interest Rates. Interest rates are likely to move higher. Thanks for those good suggestions. We appreciate it. Chief investmente strategist at russell investments. Trading options, give investors the right but not the obligation to buy or sell Financial Products and since stock prices change all the time, it is a risky business. But as jane wells shows us, more people are diving into the options world and not all young wall street hot shots. It will be the change in an options value, one unit change in time. Reporter in a library in huntington beach, california. You talk to a butterfly guy or calendar guy, what will they say. Reporter folks that paid 600 to trade options. Volatility only affects time premium. Reporter dan and peter used to do this, now they run seminars for the Worlds Largest options exchange, the cbeo. Who shows up . A male between the ages of 50 and 58. You get a few women there, maybe three women. Reporter why are boomers dabbling in options . It cost less money than buying stocks, more exciting, you can get profits more quickly or lose them and a way to manage risk. Hes a former airline pilot. I dont go to vegas and gamble but here you control your own risk. You set the rules. Reporter but this stuff is tough to learn and easy to screw up. I might be good on a trade six out of ten times, and thats considered to be a good trader. Reporter oh my gosh, baby boomers are trading options, red alert, sitting ducks, get ripped off, lose everything . Right im concerned as an educator start slowly and it takes a good year or two in many trades under your belt to get profish at this stuff. Reporter take steve burnet, a 57yearold pastor from colombia, South Carolina who traded stocks for many years and decided to kick it up a notch with options. Studying candle stick formations. Reporter he settled on a strategy of selling puts which allows investors to sell at an underlying stock for a fraction of the cost of the share price. It can be scary like the time he meant to buy five apple contracts and accidently bought 105. Which represents 4. 5 million. Scared the heck out of me before i could sell it and get it off my books. I dont know how e trade let it go through. Reporter they made him the most money. Nobody gets into it for that. Reporter looks like they are in a game with greater risks and rewards. Jane wells, los angeles. And coming up on the program, the oneyear anniversary of yahoos new ceo marissia mayer. This past year is anything but dull and well look how the Company Changed and the challenges ahead. First how commodities, currencies and treasuries performed today. Marissia myer is experiencing with invasions at yahoo and stirred up controversy. Shes been one of the most watched ceos and as her oneyear anniversary approaches, well hear many reviews on her performance. So how is she doing . Jon fortt takes a look. Reporter it had the makes of a nowin situation. The super star was swooping in trying to save the Bad News Bears of tech but somehow it looks like marissia myer is pulling it off. A year into her stint at yahoo ceo the stock is up 72 . Not because of some dramatic business turn around. The genius of miers first year is shes taken a mediocre hand and played it almost flawlessly, creating a vision, setting ex piece takes low and generating the right headlines at the right times. The year had challenges. Right off the bat she announced she was pregnant and would take minimal maternity leave, they prized her and vil fied her. The relat