THE ASSOCIATED PRESS

NEW YORK -- U.S. business chiefs continue to view the economy's performance favorably and expect to see better profits, but their overall optimism has nonetheless dimmed a bit over the last three months, the Conference Board said Wednesday.

The group reported that its index for chief executives' confidence levels moved slightly lower during the second quarter, to a reading of 70, versus 73 in the first quarter. According to the research group, readings above 50 indicate that positive responses to the survey outweighed negative ones. So for the second quarter, even as confidence slipped, it still remained quite strong.

The Conference Board's measure of business leaders' confidence is based on a survey of over 100 CEOs, in a broad array of businesses. The survey has shown steady improvement for a number of quarters, rising from its recent low point of 40, seen in the final quarter of 2001.

The group said that its index of current economic conditions compared with half a year ago held steady in the second quarter at 78.

Lynn Franco, the Conference Board economist who directed the survey, said in the report that "CEOs are very upbeat about the outlook for the next six months." Still, the group's expectations gauge slipped to 68, from 72 in the first quarter. That pullback also extended to the leaders' views of their own industry's performance over the next six months, which moved to a reading of 65 in the second quarter, from 70.

The slight reduction of confidence over both current and expected economic conditions comes as some recent economic data, such as the June jobs report, have shown signs of cooling. Most forecasters expect that after the hot output growth seen during recent quarters, the economy is now set to move forward at a more modest level of growth.

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