U.S. fund managers increased their already high exposure to equities in April and decreased bond allocations on signs the economic recovery is sustainable, a Reuters poll showed on Thursday.

Based on 12 U.S.-based management firms surveyed April 14-28, the poll found they held an average of 65.2 percent of assets in equities, compared with 64.6 percent a month earlier. The equities allocation had been 66.2 percent in February, which marks a post-crisis high.

Most of this month's poll results were taken before credit rating downgrades on Greece, Spain and Portugal.

That said, one U.S. money manager participating in the Reuters poll maintained his bullish stance even after the credit rating cuts.

Despite these (downgrades) we believe that the global economic recovery remains on track, David Joy, chief market strategist at RiverSource Investments, a subsidiary of Ameriprise Financial Inc., told Reuters in an interview.

Equity markets continue to look attractive in our view and our preference for the U.S. among the world's developed markets is in some respects enhanced, on a relative basis, by the events in Greece and elsewhere, he said.

On Wednesday Standard & Poor's lowered Spain's long-term rating by one notch to AA, a day after it issued steeper cuts on Portugal and Greece.

U.S. equities, however, closed higher Wednesday while the euro took another pounding. The Dow Jones industrial average <.DJI> gained 53.28 points, or 0.5 percent, to end at 1,1045.27, while the benchmark Standard & Poor's 500-stock index <.SPX> climbed 0.7 percent.

The debt crisis is a stark reminder that there remains lingering problems from the financial crisis that must be monitored carefully, Joy added.

So far this year Reuters U.S. poll participants have kept a high exposure in U.S. stocks, given improving economic fundamentals and robust earnings.

With just under half of S&P 500 companies having reported quarterly results, 82 percent have beaten analyst expectations, while 10 percent have missed and 8 percent have been in line, according to Thomson Reuters data.

The Federal Reserve on Wednesday also indicated things are looking up. Following the conclusion of its two-day policy meeting, and just hours after S&P's downgrade of Spain, the Fed said in a statement that the U.S. economy continues to strengthen.

Policy makers noted the U.S. labor market is beginning to improve, but said with continuing slack in the economy it expects interest rates to stay near zero for an extended period.

The Fed still hasn't stopped Reuters poll participants from scaling back their fixed-income allocations, albeit slightly.

The poll showed managers decreased fixed-income holdings to an average of 29.5 percent, from a 30.0 percent average in March. The average cash allocations remained the same for both March and April at 1.7 percent, while alternative assets remained at 2.4 percent for a second consecutive month.

(Polling by Bangalore Polling Unit; Editing by Leslie Adler)

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