* Sentiment reading rises far more than expected
* Possible Brexit delay, progress on U.S.-Sino trade talkshelp
* But ZEW still sees weak German growth in H1
* Germany narrowly avoided recession in late 2018 (Adds background)BERLIN, March 19 (Reuters) - The mood among German investorsimproved by much more than expected in March, a survey by theZEW research institute showed on Tuesday, as a potential delayto Britain's departure from the European Union buoyed sentiment.British lawmakers voted overwhelmingly last Thursday to seeka delay in Britain's exit from the EU. "The possible delay in the Brexit process as well as therenewed hope for a deal on the UK's withdrawal from the EU seemto have given rise to more optimism among financial marketexperts," ZEW President Achim Wambach said in a statement."Progress made in the negotiations between China and theU.S. to end the trade war between the two nations may also havecontributed," he added.The ZEW research institute said its monthly survey showedeconomic sentiment among investors rose to -3.6 from -13.4 inFebruary. Economists had expected an increase to -11.0.A separate gauge measuring investors' assessment of theeconomy's current conditions dipped to 11.1 from 15.0 in theprevious month. Markets had predicted a fall to 11.7.The stronger-than-expected ZEW reading bucked a recent runof weak data on the German economy, Europe's largest, whichstalled in the final quarter of last year, just skirtingrecession. "Nevertheless, the ZEW Indicator of Economic Sentiment forGermany points to relatively weak growth in the first half of2019," Wambach added.Figures released earlier this month showed industrial ordersposted their biggest drop in seven months in January, a signthat the economy had a subdued start to 2019. Many of the country's traditionally export-focused companieshave been hit hard by a cooling global economy and tradedisputes triggered by U.S. President Donald Trump.They also face taking a hit if Britain's exit from theEuropean Union is disorderly.A panel of advisers to the German government on Tuesday cutits growth forecast for this year to 0.8 percent and warnedrisks related to Britain's departure from the EU, trade disputesand a sharper than expected slowdown in China remained high. Christoph Schmidt, one of the advisers, said: "The Germaneconomic boom is over but a recession is not currently expecteddue to the robust domestic economy." (Writing by Paul CarrelEditing by Michelle Martin)