With 2014 being an election year in Indonesia, analysts are expecting higher-than-market earnings growth for the financial services and consumer discretionary sectors. Those sectors combine for over 53% of EIDO’s weight and 46.4% of IDX, according to issuer data.
Pivotal will be Indonesia’s ability to manage its current account deficit, the primary reason why EIDO and IDX slumped last year. While the fourth-quarter deficit was less than 2% of GDP, the best rate in 18 months, it is expected some deficit will persist this year.
Indonesia recently enacted an export ban on some industrial minerals, including nickel, and market observers are waiting to see what impact that will have on the country’s current account situation. [Nickel ETNs Rally]
iShares MSCI Indonesia ETF