Global X FTSE Greece 20 ETF (NYSEArca: GREK) was up sharply for the second straight day on Thursday as markets await crucial elections this weekend that could determine the country’s fate in the euro.
The Greek ETF rose nearly 8% in early U.S. trading Thursday although elsewhere in Europe, yields on 10-year Spanish government bonds jumped above 7% to a fresh euro-era high. Greece’s stock market is down over 90% from the peak.
Greek stocks and banks in particular are rallying as voters prepare to return to the polls this weekend after the inconclusive election in May. If leftist party Syriza prevails, investors are concerned Greece may end up leaving the euro.
On Thursday, Bloomberg News reported that Alexis Tsipras, leader of the Syriza party, “aims to win over voters by promising an end to punishing austerity while keeping the European Union’s financial-aid flowing.”
Greece is struggling with an unemployment rate over 20%, a contracting economy and austerity measures.
“Tsipras’s pledge to abrogate the terms of the bailout amounts to a bet the EU will stop short of kicking Greece out of the 17-nation euro,” Bloomberg reported.