At the same time, investor confidence in North America and Asia increased during December to 71.6 and 89.9 respectively, according to the data.

The index measures investor confidence by assigning a number based on changes in investor risk appetite and allocations to growth versus conservative assets over time. A reading of 100 is neutral and suggests investors are neither increasing nor decreasing their allocations to risky assets.

State Street Associates head of investor behaviour research Rajeev Bhargava said while investor confidence had declined dramatically in Europe over the month, the region was still ahead of North America when it came to optimism around the state of investment markets.

“Investor sentiment in North America continues to lag behind its European and Asian counterparts,” Mr Bhargava said.

“While still below the neutral level of 100, optimism around a workable China trade deal appears to have lifted the appetite of Asian investors.

“Interestingly however, the bounce in risk sentiment did not transmit to Europe, where investor confidence fell sharply this month, possibly from a combination of weaker economic data and continued uncertainty of a hard Brexit on the region.”