The iShares MSCI Turkey ETF (NYSEArca: TUR) was down 10% in early U.S. trading Monday as protests against the government spread, raising concern over political stability in the emerging market.
“The demonstrations have grown to become the biggest protest movement against Prime Minister Recep Tayyip Erdogan since he was elected more than 10 years ago,” CNNMoney reports. “A prolonged period of unrest could spell significant trouble for Turkey given its reliance on foreign capital and tourism. The eastern Mediterranean country made $23.1 billion from tourism last year.”
Erdogan on Monday said the rioting has led to more than 1,700 arrests, The New York Times reports.
The Turkey ETF has plunged nearly 20% from a multiyear high set in May. TUR has been one of the best emerging market ETFs since the beginning of 2012. [Turkey ETF Slumps on Risk-Off Trade]
In economic data, the HSBC Turkey Manufacturing PMI fell to 51.1 in May from 5.13 the previous month, signaling a stagnation in production levels at Turkish manufacturing companies.
Turkey has been experiencing a gradual, U-shaped recovery, said Melis Metiner, Economist at HSBC, according to WSJ.com’s MoneyBeat blog. That recovery includes a pickup in some consumption indicators, but a disappointing industrial sector, she said. “This picture would argue for further monetary easing, but the recent lira weakness could limit the central bank’s room for maneuver,” Metiner said.
iShares MSCI Turkey ETF
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