Citi sees scope for 'short squeeze' on S&P 500

Building losses among $18bn that investors have in 'short' positions on the S&P 500 could result in a so-called 'short squeeze' on the US equity benchmark taking it above 3,750, strategists at Citi said.

Longs on the other hand were on average sitting on 3.7% profits, with the next level of resistance lying at 3,800, where Citi said profits would become "extreme".

In the UK meanwhile, positioning was bullish, helped by record inflows from investors via exchange traded funds, even as markets continued to weigh the short-term headwinds, including EU-UK trade negotiations coming to a head, against the longer-term improvements in prospects.

Positioning across the Channel however was described as "very light", even if one-sided long, with only 2.5% of positions in profit at 3,525 for the Eurostoxx 50.