GLOBAL - Institutional investors in Europe grew slightly more confident in June, according to State Street's latest Investor Confidence index.

In Europe, investor confidence increase by 5.4 points from 92.3 to 97.7, while in Asia confidence rose by 1.7 points from 100.9 to 102.6.

North American investors, however, grew increasingly pessimistic, with investor confidence falling 6.3 points from 98.5 to 92.2.

Worldwide, confidence lifted slightly, increasing by 1.3 points to 89.7.

Ken Froot, a professor at Harvard University and co-developer of the index, said North American institutional investors "remained jittery", pointing out that their risk appetite had returned to levels last seen in spring 2009.

He said: "Question marks remain over the state of the US job market and overall US aggregate demand, and these, in turn, have led to diminished expectations about the pace of economic recovery."

However, State Street Associates Paul O'Connell, another developer of the index, added there was some evidence risk appetite outside North America was stabilising.

"Indeed," he said, "a look at the underlying data confirms the strongest regional flows are into emerging markets, with the exception of emerging eastern Europe.

"In addition, institutions outside of North America have been steadily accumulating US equities."

State Street's Investor Confidence index looks at the actual buying and selling patterns of institutional investors - the greater the percentage allocation to equities, the higher the confidence.