March 10, 2020 / 9:17 AM / a month ago

'Don't panic', Amundi tells investors after coronavirus crash

FILE PHOTO: Pascal Blanque, Chief Investment Officer of Amundi, attends the Euronext stock exchange's annual conference in Paris, France, January 14, 2020. REUTERS/Benoit Tessier

LONDON (Reuters) - Investors shouldn’t panic after global markets crashed due to a collapse in oil prices and fears the fast-spreading coronavirus could push the world economy into recession, one of Europe’s top asset managers said on Tuesday.

“As of today, we believe that markets have gone from being overly complacent to overly pessimistic, discounting a prolonged period of stagnant growth,” Amundi (AMUN.PA) chief investment officers wrote in a note to clients.

“Our central case, instead, is one of a temporary setback, although more prolonged compared to what we were expecting a month ago, followed by a recovery,” they added.

Expecting central banks to intervene and governments to implement fiscal stimulus to support growth, Amundi said opportunities could arise for long-term investors.

Global stock markets plunged, yields on U.S. and German sovereign bonds dropped and oil prices collapsed on Monday after Saudi Arabia launched a price war against Russia, with investors already spooked by the coronavirus epidemic.

Asian and European stock markets were trading modestly higher on Tuesday as hopes of stimulus and recovering oil prices reassured traders.

Reporting by Julien Ponthus; Editing by Alex Richardson

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