Market Overview

ETF Outlook for Friday, November 29, 2013

ETF Outlook for Friday, November 29, 2013

iShares MSCI Philippines ETF (NYSE: EPHE)

The country reported seven percent GDP growth in the third quarter yesterday, below the previous 7.6 percent and not quite at the 7.1 percent estimate. However, it is the fifth consecutive quarter of growth of at least seven percent and that was good enough to send stocks in the country higher.

Next quarter growth is expected to drop after Typhoon Haiyan took a big toll on the country. Looking ahead the rebuilding may end up boosting GDP next year. The good news is that inflation remains moderate and domestically the Philippines has strong domestic demand.

Rydex CurrencyShares British Pound ETF (NYSE: FXB)

The Bank of England announced it would scale back it’s Funding for Lending Scheme to help cool off the robust housing market. By not focusing on mortgages the BOE believes this could help divert the housing market from going into a bubble.

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The news sent the Pound higher as it would be less “easing." The currency and ETF are now sitting at a one-year high and not far from a multi-year high.

Rydex CurrencyShares Japanese Yen ETF (NYSE: FXY)

Yesterday the yen continued its freefall as Japanese stock hit a six-year high as measured by the Nikkei. FXY is trading at the lowest level in years and attempting to fight the Bank of Japan appears to be a losing battle.

The lower trade yen is not over as many analysts have been calling for. The combination of weak yen and strong Japanese stocks has been pushing the WisdomTree Japan Hedged Equity ETF (NYSE: DXJ) to new six-month highs. The ETF is long Japanese stocks and short the Yen; a win-win for investors.

iShares MSCI Germany ETF (NYSE: EWG)

The German unemployment rate did not change from last month and came in at 6.9 percent for November. But the number of unemployed rose to the highest since April 2011.

German stocks were up after the news slightly. EWG is trading at new all-time high as investors continue to put money into European stocks that appear to be trading undervalued versus their American peers. 

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