WASHINGTON – The U.S. economy is growing too slowly to pull the job market out of a slump, according to the latest data that suggest June will be another weak month for hiring.Applications for unemployment benefits stayed above a level last week that is generally considered too high to lower the unemployment rate. And the annual growth rate for the January-March quarter was unchanged at a tepid 1.9 percent.The two government reports released Thursday added to the picture of an economy that is faltering for the third straight year after a promising start. Job growth has tumbled, consumers are less confident, and Europe’s financial crisis has dampened demand for U.S. exports.Most economists don’t see growth accelerating much from the first-
quarter pace, although some are hopeful that lower gas prices could help lift consumer spending over the summer.Growth of around 1.9 percent typically generates roughly 90,000 jobs a month. That’s considered too weak to lower the unemployment rate, which was 8.2 percent last month.Slow improvement in the economy threatens President Barack Obama’s re-election hopes. He is likely to face voters with the highest unemployment rate of any president since the Great Depression.The Federal Reserve last week downgraded its outlook for 2012 growth. The Fed now predicts the economy will grow between 1.9 percent and 2.4 percent this year – half a percentage point lower than its forecast in April. And it doesn’t see the unemployment rate falling much lower this year.Hiring isn’t likely to improve in June, based on the level of people applying for unemployment benefits.Weekly applications fell only slightly last week to a seasonally adjusted 386,000, the Labor Department said. Applications have climbed nearly 5 percent in the past two months.When applications are above 375,000, it generally means that hiring isn’t strong enough to rapidly lower the unemployment rate.Economists are predicting that 100,000 jobs were added in June and the unemployment rate did not change, according to a survey by FactSet. The government will issue the June employment report July 6.“Jobless claims are still too high and show that employment growth is slowing and no progress is being made,” said Jennifer Lee, an economist at BMO Capital Markets.Employers added an average of only 73,000 jobs a month in April and May after averaging 226,000 a month in the first three months of the year.The report on the first quarter’s economic growth showed that U.S. corporate profits fell, the first quarterly decline since the final three months of 2008.U.S. corporations earned less profit overseas, the report said. That’s likely a result of Europe’s economic woes and slowing growth in countries like China and India. Lower overseas profits could discourage U.S. employers from adding some jobs in the second half of the year.“With global weakness continuing ... corporate profits are likely to remain under pressure, a development that is unlikely to help the employment outlook,” said Jeremy Lawson, an economist at BNP Paribas.The number of people continuing to receive benefits, meanwhile, rose to 5.9 million in the week ended June 9, the latest data available. That’s about 70,000 more than the previous week.Other recent indicators have painted a mixed picture of the economy.A closely watched private survey released this week showed consumer confidence fell in June for the fourth straight month. The Conference Board said worrieshttp://www.nashuatelegraph.com/business/966217-192/job-marketsuffers-with-slow-growth.html
UPDATE 3-Nike profit hit by costs, shares fall
I wish Nike would go to hell in a hand basket, I will never buy their slave labor made shoes for more than 10.00. That guy who runs it personifies what I believe is evil in this world.* Fiscal Q4 EPS $1.17 vs Wall St $1.37 view
* Q4 sales up 12 percent but margins decline
* Futures orders up 7 percent, down from Q3
* Shares down 12.9 percent
By Nivedita Bhattacharjee
June 28 (Reuters) - Nike Inc missed quarterly profit estimates for the first time in at least two years as higher spending and increased costs of materials used in its shoes and T-shirts hurt margins, while demand eased in international markets.
The results sent shares of the world's largest sportswear maker down nearly 13 percent in extended trading on Thursday.
Orders of Nike branded shoes and clothes scheduled for delivery from June through November, a closely-watched metric of demand known as "futures orders" rose 7 percent. That is less than half of the rise of futures orders in the fiscal third quarter.
In the fourth quarter that ended May 31, futures orders rose only 5 percent in Greater China, down from a 24 percent increase a year earlier, a sign that even the popular Nike "swoosh" is not immune to slowing global economic growth.
Analysts and investors have been worried about a cooling in demand as footwear trends typically last about two to three years. Nike has been hot in the running shoe market for almost two and a half years now, said Morningstar analyst Paul Swinand.
The company earned $549 million, or $1.17 cents a share, in its fourth quarter, compared with $594 million, or $1.24 a share, a year ago.Analysts, on average, had been expecting the company to earn $1.37 share, according to Thomson Reuters I/B/E/S.
Revenue rose 12 percent to $6.5 billion.
Gross margins fell 1.5 percentage points in the fourth quarter and have been declining for more than a year.
"While we had expected some gross margins decline and some increase in spending with the Olympics and soccer championships, both are higher than expected," said Swinand.
Swinand also said the drop in the share price could be a chance for investors to buy shares of the company, as he did not think the company has any flaws in execution.
Matt Arnold, consumer discretionary analyst for Edward Jones, saw improvement ahead for Nike.
"Margins will eventually become better and they have already taken pricing actions, so in general we think it is a matter of time. Nike is a strong brand with a lot going right for it," said Arnold.
Nike's finance chief, Don Blair, said higher input costs were the primary reason for the profit drop in the quarter. Higher prices and lower air freight expenses helped mitigate the rising materials costs.http://www.nashuatelegraph.com/business/966217-192/job-marketsuffers-with-slow-growth.html
RIM Plunged Amid Loss, Job Cuts And BlackBerry Delay
Rim stands on the edge of a cliff and should just get ready to jump. I see crackberry loyalists switching to the iPhone. Research In Motion Ltd. (RIM) plunged as much as 22 percent in late trading yesterday after posting a loss and delaying the next BlackBerry operating system, increasing pressure on the company to find an acquirer.RIM reported a first-quarter loss yesterday of 37 cents a share, excluding some items, more than five times bigger than what analysts had predicted. Sales tumbled 43 percent to $2.8 billion, missing a prediction of $3.05 billion, and the company said it would cut 5,000 jobs.The Waterloo, Ontario-based smartphone maker had been waiting for a release of the BlackBerry 10 in the fall to decide on its strategic options, betting that the success of the product would let it avoid a sale, according to two people familiar with the situation. With no new lineup this year -- and the next version of Apple (AAPL) Inc.’s better-selling iPhone looming -- RIM may have to seek a buyer now.“They either sell, break up the company or die,” said Matt Thornton, an analyst at Avian Securities LLC in Boston who has a neutral rating on RIM. “It is just a question of when.”Chief Executive Officer Thorsten Heins said in May that RIM had hired JPMorgan Chase & Co. (JPM) and RBC Capital Markets to help evaluate its strategic options, though he said a sale wasn’t the company’s goal. RIM would prefer to find a partner or license its operating system. Heins reiterated that notion yesterday, saying he was “convinced” that RIM has a future as a maker of hardware and software.
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