German investor morale crashes on coronavirus fears, economy on 'red alert'

The mood among German investors slumped in March to levels last seen in the 2008 financial crisis due to alarm about the impact of the coronavirus outbreak, a survey showed on Tuesday. The ZEW research institute said its monthly survey showed economic sentiment among investors collapsed to -49.5 from 8.7 in February. Economists had expected a drop to -26.4.

"The economy is on red alert," said ZEW President Achim Wambach in a statement, adding financial experts expect the economy to shrink in the first quarter and think a contraction is also very likely in the second quarter. A separate gauge measuring investors' assessment of the economy's current conditions decreased to -43.1 from -15.7. Analysts had forecast a reading of -30.0. (Writing by Madeline Chambers, editing by Thomas Escritt)