ETF Trends
ETF Trends

Despite ongoing violence related to the drug cartel battle raging across the border, Mexico’s stock market and exchange traded fund (ETF) have been doing quite well this year, thanks in part to a booming tourism industry.

International tourism to Mexico increased to 7.1 million in the first eight months of the year, or up 19.2% year-over-year. The largest gain was in July, which saw 27.5% growth from the previous July, rep0rts Hugo Martin for The Los Angeles Times. Tourists were flocking to beach towns, which have largely been untouched by violence.

The Mexican stock market IPC Index is up 6.7% year-to-date, writes Aaron Smith For CNN Money. John Lomax, emerging markets equity analyst for HSBC in London, has upgraded Mexico to an “overweight” rating, stating that “we saw very strong growth in Mexico for the first half of the year.” Alonso Cervera, emerging markets analyst for Credit Suisse in New York, has raised his GDP projection to 4.7% for 2010.

The weekly beef sales data from the U.S. to Mexico for August is showing improvements, even though Mexico’s slower economy and weak peso have made U.S. beef a tougher sale this year, according to High Plains Journal.  [Latin America ETFs: It’s Not All About Brazil.]

For more information on Mexico, visit our Mexico category.

  • iShares MSCI Mexico (NYSEArca: EWW) is up 10.2% in the last three months; the fund contains exposure to a variety of Mexico’s industries, but the heaviest weighting is in telecom, which has 26.8% of the fund. Other sectors include retail (9.7%), commercial banks (7.7%) and non-ferrous metals (5.8%).

  • SPDR S&P Emerging Latin America (NYSEArca: GML) holds a 21.5% weighting in Mexico and 64.3% in Brazil

Global ETFs, Mexico ETFs

Max Chen contributed to this article.

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.