Japan fund managers cut stock weightings in April

By Akiko Takeda

TOKYO, April 30 (Reuters) - Japanese fund managers have grown more cautious about investing in global stock markets over the past month due to fears of a U.S. recession, a monthly survey showed.

The poll of 11 Japan-based institutional investors, who were asked about their investment stance heading into the next month, showed their average stock allocation fell to 56.4 percent from 57.8 percent in the previous survey.

Bond allocations rose to 38.8 percent from 37.2 percent while the weighting for cash stood at 5.4 percent, up from 4.9 percent in March.

The figures in the latest survey are not fully comparable with historical figures as Nissay Dowa General Insurance withdrew from the survey.

"The problem in Western financial institutions' balance sheets is not solved yet," said Jun Ishigane, a strategist at Mitsubishi UFJ Asset Management.

"As we see more signs that the U.S. economy is slowing down, there will be more selling in equities," he said. Akio Yoshino, chief economist at Societe Generale Asset Management, also said the credit crunch was likely to hamper the economic recovery.

Still, a strong rebound in global stock markets this month has eased concerns among some fund managers.

The risk of a major failure a)ämong U.S. banks has receded after the Federal Reserve helped to orchestrate the rescue of Bear Stearns BSC.N, said Yoshinori Nagano, senior strategist at Daiwa Asset Management.