New York City The disconnect between Wall Street and Main Street is growing.
Americans’ confidence in the economy faded further in July, according to a monthly survey released Tuesday, amid job worries and skimpy wage growth. That’s at odds with Wall Street’s recent rally fueled by upbeat earnings reports from big businesses such as chemical maker DuPont Co. and equipment maker Caterpillar Inc. That’s because the pumped-up profits are being fueled by cost cuts like layoffs and overseas sales. In fact, big companies have shown few signs they’re ready to hire.
The Consumer Confidence Index came in at 50.4 in July, a steeper-than-expected decline from the revised 54.3 in June, according to a survey the Conference Board. The decline follows last month’s decline of nearly 10 points, from 62.7 in May, and is the lowest point since February. It takes a reading of 90 to indicate a healthy economy — a level not seen since the recession began in December 2007.
“Consumers have a much different view of the economy than the stock market does, and their views matter more to the economy,” said Mark Vitner, an economist at Wells Fargo.