Investing.com -- Global equity positioning weakened further last week as investors turned more defensive and bearish flows re-emerged across major markets, according to Citi analysts in a note Tuesday.

The bank said renewed short-selling across the U.S., Europe and parts of Asia drove a broad-based deterioration in sentiment.

While positioning remains largely neutral across most indices, it said underlying profit-and-loss conditions have become increasingly fragile.

"Russell 2000 and DAX stand out as markets where loss-making positions have accumulated rapidly," Citi wrote, warning that this raises the risk of further de-grossing and position unwinds.

In the U.S., the bank noted that positioning weakened as investors added bearish exposure in both the S&P 500 and Russell 2000, with new shorts dominating flows.

Nasdaq positioning was said to be comparatively resilient, leaving it near unchanged. Position risk is most concerning for the Russell 2000, Citi said, "with all longs currently loss-making" and aggregate investor profit and loss declining rapidly.

In Europe, positioning deteriorated as investors cut risk across most indices, with new shorts dominating flows in the DAX, FTSE 100 and European banks.

The Euro Stoxx 50 was an exception, remaining relatively resilient as meaningful short covering more than offset broader regional de-risking, resulting in a modest improvement in positioning despite weaker index performance.