NEW YORK — A private business group's measure of the economy's health showed the largest drop in one year as stocks fell, new building permits declined and unemployment rose.

The New York-based Conference Board's said Thursday its monthly forecast of future economic activity fell 0.7 percent in July, far more than the consensus estimate of a 0.2 percent decline by Wall Street economists surveyed by Thomson/IFR.

The last time the index showed a drop this great was last August, when it fell by 1 percent.

Revised June data showed no change to the index, which has slipped 0.9 percent for the six months ending in July.

The decline was the steepest in the index this year. The largest drag on the index was the decline in building permits, followed in order by stock prices, rising unemployment claims, a tightened money supply and falling manufacturers' orders for consumer goods.

Interest rate spreads, consumer expectations and manufacturers' orders for capital goods all contributed to the index.

Stocks, which were down before the index's release, cut some of their losses. The Dow Jones industrial average was down 52.35 at 11,365.08. The Standard & Poor's 500 was down 4.45 at 1,270.09, and the Nasdaq Composite was down 18.64 at 2,370.44.