More than half of fund managers believe equities are overvalued, a view which has been underscored by the likelihood of interest rates rising further according to a monthly investor survey.

Karen Olney, equity strategist for Merrill Lynch, said "More investors than not believe equities are over-valued, according to our global survey, but regionally there are pockets where they still think equities are under-valued. For instance in Japan, the US and the UK."