Citi's equity markets positioning model points to bullish positioning intensifying for US large caps as Europe stabilises
- Citi says bullish positioning in US large caps has intensified into increasingly stretched territory, with legacy short exposures in the S&P 500 leaving scope for further upside via covering, while profit-taking risk is rising in the Nasdaq given elevated P&L levels.
- European flows have turned more constructive with renewed long flows to EuroStoxx, DAX and FTSE, though EuroStoxx remains net short with limited conviction.
- KOSPI positioning remains the most extended globally, raising mean-reversion risk, while China A50 has seen steady improvement in bullish positioning.
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