Eurozone investor morale collapses amid coronavirus outbreak
Morale among Eurozone investors plunged in March to its lowest level in seven years as the coronavirus outbreak brought fears of a European recession.
The sentiment gauge from data firm Sentix slumped to minus 17.1 in March from 5.2 in February. The fall was well below economists’ forecast of minus 11.1.
“Never before has such a strong synchronized collapse of the global economy been measurable in our data,” said Sentix boss Manfred Huebner.
“This puts the current slump in an inglorious chain: Lehman (2008), Fukushima (2011) and the oil credit crisis (2016).”
Coronavirus, which first emerged in China in December, has spread rapidly across Europe in recent weeks, with Italy the worst-affected country.
Italy saw a spike of 133 deaths over the weekend, taking the toll to 366. That is the biggest death toll outside China’s Hubei province.
The dire sentiment reading came as panic gripped European stock markets. The continent-wide Stoxx 600 index has fallen more than six per cent today, taking it into bear territory – a fall of 20 per cent since recent highs.
Daniela Ordonez, lead Eurozone economist at consultancy Capital Economics, said: “The collapse in March’s Sentix marks only the start of what is set to be growing economic fallout as the rapid spread of coronavirus worldwide delivers the biggest shock economic shock since the global financial crisis.”
France and Italy today both called for Europe-wide government spending to tackle the economic fallout of coronavirus.
Italy’s Prime Minister Giuseppe Conte pledged a big fiscal boost to support the country’s economy, which was already in dire straits before the outbreak.
“We will use a massive shock therapy. To come out of this emergency we will use all human and economic resources,” Conte said.