Citi's equity markets positioning model notes conviction concentrates in KOSPI and FTSE
Importance
Level 1
- Citi writes that as geopolitical and macro uncertainty remains elevated, the combination of extended longs on FTSE and KOSPI, weakness in the US and China, builds a case for a continued selective risk approach
- The bank notes that global equity positioning continues to turn increasingly polarised, with select European and Asia indices emerging as clear favorites.
- "The US shows a growing bearish undercurrent despite the seemingly resilient headline flows," and "S&P 500 flows were positive but normalised positioning have hardly changed, while Nasdaq positioning trended lower."
- In Europe, Citi says that the FTSE holds max long, with elevated profit levels.
- In Asia, the KOSPI continues to be supported by new long risk flows, a trend also seen in Nikkei positioning. China A50 and Hang Seng positioning remains weak.
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