Bullish positioning saw a notable decline across most global stock indexes last week, Citi strategists said in a note Monday.

According to the bank, the S&P 500's positioning “turned neutral,” driven primarily by the unwinding of long positions and the initiation of new shorts.

“Recent weekly futures activity reflects increased caution and rising bearish momentum,” the note writes. “De-grossing on the S&P has also driven both long and short levels back towards long-term averages.”

In the Nasdaq, the changes in positioning were less pronounced but followed a similar path. Weekly futures activity indicated a slight decline in net notional, with new short flows emerging. Despite this, Nasdaq positioning remains bullish but not as extended as before.

In Europe, similar trends were observed, with a general decrease in notional levels across various indices. However, the current positioning risks remain highest for European banks. Strategists highlighted that bullish positioning and long profit levels in European banks are still elevated, presenting significant profit-taking risks.

The most significant weekly positioning changes in Europe were seen in DAX futures, which turned neutral.

Elsewhere, the Hang Seng index experienced increased flows, with bullish positioning reaching a three-year high relative to the A50 index. Despite this peak, the associated profit levels remain small, thus limiting the overall positioning risks.

“Across the other indices, positioning changes were limited, but recent trends continue to persist, leaving KOSPI the most bearish of the indexes tracked,” Citi added.