ETF Trends
ETF Trends

ETFs that invest in Greece and other European countries fell at the open Monday as Cyprus was poised to force savers to chip in to help pay for a financial bailout.

Global X FTSE Greece 20 ETF (NYSEArca: GREK) was set for further declines after recently falling about 15% from its 52-week high.

Meanwhile, iShares MSCI Italy (NYSEArca: EWI) and iShares MSCI Spain (NYSEArca: EWP) both slipped about 3% before Monday’s opening bell in the U.S.

Cyprus joins Greece, Ireland, Portugal and Spain to ask the Eurozone for a bailout. However, Cyprus is the first country to introduce a levy on bank deposits as a condition for financial aid. [Euro ETF Tumbles on Cyprus Levy]

“Should depositors in Cyprus or other peripheral countries feel safe now? They may not. After all, deposit-guarantee schemes do not guarantee against a levy. Depositors may also have to factor in that the one-off levy could inspire national governments to do the same thing. So the risk of bank runs has just gone up,” analysts at Danske Bank said in a Greek Reporter story.

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