Turkey’s exchange traded fund (ETF) was one of last year’s top performers and its economy likely grew in the fourth quarter. Now a coup in the country threatens to undo its hard-won growth.

The Daily Maverick reports that Turkey’s military/Islamist tensions bubbled to the surface as dozens of officers were arrested, causing turmoil and unrest in the economy. The newfound growth and stability in Turkey could be at stake. What’s emerged is a battle between the country’s religiously conservative leaders and secular institutions. [5 ETFs to Play Eastern Europe.]

Seda Sezer and Laura Cochrane for Bloomberg report that investors are already betting that the turmoil will wreak havoc upon the country’s currency, stocks and bonds, all of which have slumped in the wake of the unrest. [Turkey ETF: A Cautious Recovery.]

Until the coup, Turkey’s ETF had been one of the strongest performers off the market’s March 9 low, up 168% since then. It’s down 8.5% in the last two weeks and it’s now sitting below its long-term trend line.

Nevertheless, prognosticators say that Turkey’s economy likely grew 4%-5% during the fourth quarter, 2009, says ForexYard. But will it stick? If this situation drags on, it could hurt the ETF’s prospects.

For more stories about Turkey, visit our Turkey category.

  • iShares MSCI Turkey Index (NYSEArca: TUR)

  • SPDR S&P Emerging Europe (NYSEArca: GUR): Turkey is 14.7%

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.