European equity futures are signalling bearish positioning as the market extends
a five-month rally. Citigroup strategists say overall positioning remains the
strongest among developed markets on average, but sentiment 'mildly
deteriorated' last week; recent flows were driven by new short positions in the
Euro Stoxx 50 and Germany's DAX. Seasonal risk: September is typically the
weakest month for the Stoxx Europe 600, averaging a 2.1% decline over the past
five years. That seasonal weakness coincides with firmer hawkish signals from
central banks, rising political uncertainty in France and the US, and a
persisting Iran conflict. Leverage Shares senior research analyst Violeta
Todorova warned that after a strong run markets may be more vulnerable to
volatility and less willing to look through disappointing data or negative news.
