Optimism among European investors fell sharply in December amid growing economic concerns, a survey co-sponsored by UBS and Gallup claimed today.
The UBS Index of Investor Optimism - featuring investors in France, Britain, Germany, Italy, and Spain - sank 10 points to -38 in December compared to the previous month, leaving the index at its lowest level since its inception in October 2001.
"Despite the apparent stablisation in economic data, the modest rise in European equity markets this quarter, and the latest round of interest rate cuts from the Federal Reserve and the European Central Bank, European investors remain very risk averse," said UBS Warburg's Mr Saul Henry.
Fifty-eight per cent of respondents said they were pessimistic about economic growth over the next 12 months, up from 54 per cent in November.
The proportion of investors who thought it very likely or somewhat likely that the European economy would enter a prolonged period of stagnation was 45 per cent.