Investor sentiment has soured this month as attitudes towards UK equities turned negative for the first time in the history of the survey.

Investor confidence has sunk to its lowest level on record as a result of ongoing market turmoil, according to the latest Lloyds Bank Private Banking Investor Sentiment Index. 

March saw a declining performance across seven of the ten asset classes. Gold and UK government bonds bucked this trend and UK equities saw a small month-on-month increase of 0.3 per cent. Meanwhile, confidence towards commodities rebounded despite the dip in actual market performance of the asset class over the last month.

After three months of falling sentiment, the mood among investors is at its lowest level (2.26 per cent) since the index began three years ago. The overall fall in sentiment was driven by negative attitudes towards UK equities, at -2.49 per cent. Compared to last year, this constitutes a collapse of 39 percentage points for what has been historically one of the most highly regarded of the ten asset classes. 

“The reversal in sentiment compared to one year ago is pronounced, with only gold seeing a positive change in the eyes of investors,” said Markus Stadlmann, chief investment officer at Lloyds Bank Private Banking. 

“Despite minor rises in net sentiment of 0.03 per cent and 0.56 per cent for UK government and corporate bonds respectively, they have both reached record year-on-year falls of around 15 percentage points each. UK property is on a negative trajectory while gold is benefitting from its perceived status as a 'haven' investment during turbulent times,” he added. 

As the UK's EU referendum edges closer, talks of increased market volatility may have an impact on overall investor sentiment over the coming months, the bank said.

Lloyds Bank Private Banking took its data from a survey of 4,295 adults in the UK of which 1,071 were investors.