By Sam Boughedda
Citi analysts told investors in a note on the firm's equity markets positioning model that investors remain neutral on the US and bearish on Europe.
"Continued volatility in market returns is not matched with any clear flow momentum," wrote the analysts. "Positioning gives no clear direction for markets from here, but the setup with offsetting long and short positions could amplify market moves up or down in the near term."
Focusing on US equities, the analysts explained that flows have been modest and mixed with the recent roll period in the S&P 500, seeing "large short positions placed and then unwound again within the space of a few sessions but post the roll flows have slowed significantly."
Meanwhile, for Europe, "investors are more bearishly positioned." This is particularly the case for UK equities, said the analysts, "where one-sided positioning is in profit."
"The bank futures show neutral positioning, and bank ETF outflows have undone the inflows earlier in 2023," they added.
The analysts also revealed that in Asian equities, Nikkei positioning remains the most strongly bullish market, but he noted that the positioning was built up in early March and has been gradually fading.