Need Advice - 7 year old with sudden change of behaviour

I was wondering if there were any Moms on this board who have had to manage sudden changes in behavior with regards to their children. I am really at a loss as to what to do right now with my son who has just turned 7. Sorry for the long email but I am a bit emotional
The other day, there was an incident at his school which prompted the teacher to schedule a meeting with me to "discuss his behavior”. In a nutshell, his class went to the library the other day and he saw a book that he wanted to borrow but his classmate checked it out first. My son was pretty upset so he waited until the end of the day and when nobody was looking, he opened the boy's bag and switched books. It turns out that the teacher saw what happened and made him give the book back ( I would have done the same). I was not at the school to pick my son up that day as I was at the doctor so I sent my maid to fetch him. The teacher told the maid what happened and the maid then relayed to us. My son was in a bit of a state that night and I had "the talk" with him. He seemed to understand what he had done and I thought that was the end of it. I waited a couple of days for the teacher to contact me about the incident but she never did so in the end, I sent her an email explaining that I had spoken to my DS and that I was happy that she had given him a warning. She then emails me back saying that DS has serious behavioral problems and that he is disruptive in class and that she wouldn’t want to see him get blamed for everything that goes wrong in the classroom. At the time, I was pretty shocked as he had a really good year last year and was never in trouble. He has also been a very happy boy at home and enjoying his homework etc.
Yesterday afternoon, he had another huge outburst. We had been to the petrol station and I had bought him some skittles in the shop for after dinner. When we got home, he wanted to open the skittles so I explained to him again that they were for after dinner and placed them on the top shelf. He then went crazy, started screaming and took a packet of chewing gum out of his pocket and said “I don’t care about the skittles, I stole this!!!” Well, I was in shock as I didn’t see him take the gum. I then drove a very scared and teary boy back to the petrol station where I made him return the gum and apologize to the manager.
This morning, on the way to school, we had a BIG chat and he was very down on himself. He kept saying that he was a “very bad boy” and that everyone in the class hated him and thought he was crazy etc..Since he has been in this class, something has dramatically changed in his behavior. He has gone from being a confident and likable, happy go lucky boy to one that has started stealing ( OK only bubble gum ) and who seems to think that he is doomed to be bad.
I have a meeting with the teacher today to discuss his behavior and to be honest I am feeling quite sick about it. I know my DS well and he is not a perfect child but he is normal for his age. I can’t help but think that something has happened in the class or at school to trigger this. Any ideas?