LIVE MARKETS-War dents investor sentiment towards European stocks - BofA survey

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WAR DENTS INVESTOR SENTIMENT TOWARDS EUROPEAN STOCKS- BOFA SURVEY

Investors have turned less positive towards European stocks relative to the U.S. due to the U.S.-Israeli war on Iran, BofA's monthly European fund manager survey found.

According to the survey, published on Tuesday, a net 21% of global investors say they are overweight European equities in a global allocation context, down from 35% last month.

That mirrors the shift in attitudes towards the U.S. where a net 17% report being underweight U.S. equities, down from 22% last month.

Of course, that still shows investors are net overweight Europe and net underweight the U.S., so it's not necessarily the end of this year's bout of excitement about European outperformance, but it is perhaps the end of this iteration of it.

Those results echo what we have seen in terms of prices. Europe's STOXX 600 .STOXX has fallen 5.1% since the start of March, compared to a 2.6% fall for the S&P 500. .SPX

Still, while they're more pessimistic than they were, the survey found investors aren't expecting doom and gloom. 61% of investors surveyed still expect upside for European equities, albeit down from 78% last month, while the share that sees downside is at 25% compared to 11% last month.

And year to date the STOXX is still outperforming the S&P. The European benchmark is 1.5% higher on the year while the U.S. one is down 2%.

(Alun John)

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