US economic outlook darkens

US economic outlook darkens

WASHINGTON

Faced with a fizzling job market, many economists have turned more pessimistic and no longer think U.S. economic growth will accelerate later this year.

Friday’s surprisingly bleak jobs report for May followed a spate of weak U.S. economic data last week. Manufacturing activity slowed, an index of home contracts fell, and consumer confidence tumbled. Mounting troubles in Europe and elsewhere have heightened economists’ concerns.

Julia Coronado, an economist at BNP Paribas in New York, said she now expects growth of 2.2 percent this year, down from her previous forecast of 2.4 percent. She also revised down her estimate of growth in the April-June quarter to a 2.2 percent annual rate, from a 2.5 percent rate.

After the jobs report Friday, JPMorgan Chase sharply reduced its growth forecast for the July- September quarter to a 2 percent annual rate, down from 3 percent. It cited the weaker U.S. hiring and a likely drop in U.S. exports related to slower growth overseas. And JPMorgan Chase now forecasts growth of 2.1 percent for 2012, down from 2.3 percent.

Votes show dissent against executives

NEW YORK

Wal-Mart’s final shareholder vote for its board of directors showed unprecedented dissent against key executives and board members, including CEO Mike Duke, in the wake of allegations of bribery in Mexico.

All of the company’s nominees were re-elected. But the rise in votes against key leaders underscores how the bribery case could distract the world’s largest retailer as it tries to continue its sales momentum in the U.S. and overseas.

According to results released by Wal-Mart on Monday, 13 percent of the 3.4 billion shares were voted against the re-election of Duke to the company’s board. Nearly 13 percent went against Chairman Robson Walton, the son of founder Sam Walton, and 15.6 percent went against former CEO Lee Scott. A little over 13 percent of the shares were cast against Christopher Williams, chairman and CEO of The Williams Capital Group, who serves as chairman of Wal-Mart’s audit committee.

Court: Reinstate suit alleging kickbacks

CINCINNATI

A federal appeals court has ordered the reinstatement of a lawsuit accusing Duke Energy Corp. of paying kickbacks to Cincinnati-area companies to win their support for a 2004 electricity rate hike.

The 6th U.S. Circuit Court of Appeals in Cincinnati on Monday reversed a judge’s 2009 decision dismissing the antitrust lawsuit filed on behalf of Ohio businesses and individuals. The three-judge appeals-court panel says the judge incorrectly ruled that federal courts had no jurisdiction in the case.

The lawsuit claims the utility known then as Cinergy Corp. paid off large corporate customers who opposed the rate request in 2004. The lawsuit also says the rate hike cost small businesses and homeowners millions of dollars.

Charlotte, N.C.-based Duke Energy bought Cinergy in 2006. The utility denies the allegations.

Vindicator wire reports