There have been signs of stock market euphoria in 2021 but sentiment seems to be cooling.

Surveys are mixed right now. The mood remains “unambiguously bullish”, according to Bank of America’s latest monthly fund manager survey, although a closer look at its findings suggest things are less frothy. The number of respondents taking higher-than-normal risk has fallen; equity allocations have fallen slightly; cash levels are low but no longer falling.

A separate weekly survey by the National Association of Active Investment Managers suggests equity exposure has fallen significantly of late.

As for retail investors, sentiment hit a bullish extreme last month but has now returned to normal levels, according to American Association of Individual Investors polls.

Meanwhile, CNN’s Fear and Greed index, a composite sentiment tool tracking multiple indicators, indicates investors are more fearful than greedy.

Until recently, sentiment looked like it had become "a bit too frothy", says Bespoke Investment, "but there's nothing like a market sell-off to get investors back on their toes".