There is also talk in Europe of finally admitting Turkey to the EU, he adds. “Turkey’s admittance to the EU had stalled over Cyprus, but more recently, France and Germany seem to be warming to the idea,” Holmes said.
Still, the Turkey ETF’s recent pullback was driven partly by disappointment that Moody’s didn’t upgrade the emerging market’s credit rating. [Turkey ETF Falls on Ratings Disappointment]
Yet Holmes points to Turkey’s well-capitalized banks, solid GDP growth and manufacturing sector strength as positive factors.
iShares MSCI Turkey
Full disclosure: Tom Lydon is on the board of directors for U.S. Global Investors.