Amid growing concerns about the stock market and corporate scandals, consumer confidence took a dive in July to its lowest level in five months.

The private research group The Conference Board on Tuesday reported its Consumer Confidence Index fell to 97.1 from a revised 106.3 in June.
This survey of 5,000 U.S. households also found consumers are increasingly pessimistic about the future.
“The decline was considerably larger in expectations six months ahead than for assessment of current conditions,” said Newport Communications Senior Economist Jim Haughey. “By a now slimmer 2:1 margin, consumers expect conditions to improve in the next six months but now no longer expect jobs to become easier to get.”
He says the grim news about the corporate accounting scandals, the plunge in stock market indexes and negative talk about the economy by some politicians in an election year has convinced consumers that the recovery is stalled. However, he notes this change of view has not impacted any of the hard economic measurement data through June.
“Annual growth rates in economic forecasts for the second half of the year have been trimmed back about 0.5% because of the decline in confidence and the inevitable bite this will take out of consumer spending,” said Haughey.
“The new corporate financial fraud legislation signed today and the 1,000-point surge in the Dow Jones Index should be enough good news to stop any further significant slide in confidence. So the growth outlook for the second half of the year remains at 3% plus.”