INSTANT VIEW: Consumers more pessimistic in July

NEW YORK (Reuters) - U.S. consumer confidence waned in late July to the lowest reading since April on growing pessimism about the long-term economic outlook, a survey showed on Friday, even as some economists reckon the longest recession in decades may be easing.

KEY POINTS: * The Reuters/University of Michigan Surveys of Consumers said its final July consumer sentiment reading fell to 66.0 from June's 70.8, though it was slightly higher than economists' median expectation for a reading of 65.0, according to a Reuters poll. * The index of consumer expectations fell to 63.2 in July's final reading, from 69.2 in June. * "Consumers believe that the economic free-fall is now over, but consumers see little reason to believe the stimulus policies will improve their financial condition any time soon," the Reuters/University of Michigan Surveys of Consumers said in a statement. * Lower income and less favorable job prospects in the next year are key factors making consumers anxious about their financial position, the statement said. * The current conditions index slipped to 70.5 in the final July reading, from 73.2 in June.

COMMENTS:

JORDAN POSNER, PORTFOLIO MANAGER AT MATRIX ASSET ADVISORS IN NEW YORK:

"Consumers have certainly tempered their enthusiasm, which is consistent with the consumer outlook we've had for the economy over the course of 2009. Any recovery is not going to be led by consumers.

"Eventually, the consumer will have to participate for the recovery to persist, but certainly the mood of consumers and the expectations are better now going forward than they were in the winter.

"The expectation for inflation by consumers is more contained than some of the fear-mongering we've seen by economists."

DAVID WYSS, CHIEF ECONOMIST, STANDARD & POOR'S RATINGS SERVICES, NEW YORK:

"People are a little more worried about the economy, especially over the labor market and what's happening in Washington. It's still consistent with the picture that the economy is bottoming out, but you are not going to get a big bounce in consumer spending.

"We are going to see the stock market improve but it has gotten ahead of itself given my expectations of a soft economic recovery. We are going to need a mid-rally correction. This is the biggest rally we've had since the 1930s and it makes me nervous."

DOUG ROBERTS, CHIEF INVESTMENT STRATEGIST, CHANNEL CAPITAL RESEARCH, SHREWSBURY, NEW JERSEY:

"That indicates right now that for the most part confidence is restoring but it is really going to be overshadowed by the earnings numbers and consumer spending. Michigan confidence is a leading indicator, it's been improving, but what we really want to see is if that is going to translate into retail sales - that is going to be the key thing."

MARKET REACTION: STOCKS: U.S. stock indexes added to losses. BONDS: U.S. Treasury debt prices were little changed. DOLLAR: U.S. dollar was flat.