Citi cut its ratings on US stocks, global tech stocks and European tech stocks to neutral on November 9, citing weakening sentiment around AI and the risk of further selling by investors.

The bank warned that the Nasdaq could fall about another 5% before investor positioning turns decisively bearish. Citi said it remains constructive on AI over the medium term, but wants to see steadier market sentiment and earnings expectations before turning bullish again.

At the same time, Citi upgraded European stocks outside the UK to overweight. It said the region benefits from lower oil prices and has less exposure to tech stocks.