LONDON, Oct 26 (Reuters) - Confidence among institutional investors fell globally in October as flows into emerging markets were offset by a flight from developed economies, State Street said on Tuesday.
The U.S. financial services firm said its global investor confidence index fell to 86.2 from a downwardly revised 88.1 in September.
Anything below 100 implies bearish sentiment among State Street's large institutional clients. The index was last above 100 in March.
But State Street said the result masked an underlying pattern of investors embracing supposedly riskier assets in emerging markets.
"Looking at the underlying data, institutions have been allocating away from developed markets and towards emerging markets," said Harvard professor Ken Froot, a co-developer of the index.
"But the net of the two flows has been negative."
Regionally, State Street's North America index fell to 84.9 this month from 88.1 in September.
European investors' confidence also slipped a bit, to 96.4 from 97.0 in September. Asian investors confidence was down as well, at 103.3 from 107.7, but still in positive territory.
The indexes are drawn from movements in around $20 trillion of assets State Street holds as custodian and administrator for institutional investors. (Reporting by Jeremy Gaunt; Editing by Susan Fenton)