Confidence among global institutional investors rose in December, as improved sentiment toward the United States outweighed continued concerns about Europe, State Street Corp said on Tuesday.

The financial services firm said its global investor confidence index rose to 104.4 from a revised November reading of 96.4. A reading of 100 is neutral, indicating that investors are neither increasing nor decreasing their allocations to risky assets.

The readings on both North America and Asia rose in the month. The North American index gained 7.7 points to 103.1 while the index for Asian investors advanced 7.4 points to 102.9.

Clearly, the scenario for moderated world growth with recovery in the U.S. has increasingly gained traction, said Kenneth Froot, a Harvard University professor who helped develop the index.

The index of European investors, however, fell to 99 from a revised November reading of 109.8.

European investors are back again to worrying that high sovereign indebtedness may prove destabilizing for the region, said State Street's Paul O'Connell, who co-developed the index with Froot.

The indexes are drawn from movements in the roughly $20 trillion worth of assets State Street holds as custodian and administrator for institutional investors.

(Reporting by Ryan Vlastelica; Editing by Leslie Adler)