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Bailey McCann, Opalesque New York: Investors have scaled back both risk-taking and their expectations for global growth after concerns about European Union (EU) economies resurfaced, according to the BofA Merrill Lynch Survey of Fund Managers for April. Investors are returning to cash, with a net 6% increase in movement to cash over last month.

Concerns over European finances have risen sharply as financial news out of Spain looks bleak 63% of those surveyed expect more negative surprises from the country this year. While more than half of the panel says that EU sovereign debt funding is the number one tail risk, up from a 38% in March. France is also expected to provide new negative news this year - according to respondents, regardless of which candidate wins the upcoming presidential election there.

"Investors have moved to a more neutral position after positive shifts in sentiment and risk taking in the first quarter. We believe investors will retain a sense of caution throughout the second quarter," said Michael Hartnett, chief Global Equity strategist at BofA Merrill Lynch Global Research in a statement.

The panel also viewing quantitative easing measures with renewed interest in light of increased European worries. Respondents are also losing confidence in overall economic recovery, 20% are positive on economic growth down from 28% last month. Investors expect further quantitative easing measures through 2012, adding to overall bearishness about the globa......................

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