Investors could be gaining confidence in Spanish markets and related exchange traded fund as the country’s financial sector rebounds and yields on benchmark Treasuries dip to a two-century low.

The iShares MSCI Spain Capped ETF (NYSEArca: EWP) has increased 10.8% year-to-date. In comparison, the FTSE Eurotop 100 Index, which tracks the largest companies taken from the Eurozone, is up 5.4%. [Spain ETF Stands Out in the Eurozone]

Yields on benchmark Spanish 10-year bonds dipped to 2.488%, the first time rates fell below 2.5% in over two hundred years, the Financial Times reports.

“The fact that these rates continue to decline and there is no reversal shows that nobody sees issues that are likely to push yields higher,” said Patrick Jacq, a bond strategist at BNP Paribas, said in an Economic Times article.

Government borrowing costs have been declining to record lows across the Eurozone after the European Central Bank reduced its key interest rate below zero and enacted a multi-billion euro lending package.

“In an environment where you are struggling to get yields elsewhere, investors have little choice,” Nick Stamenkovic, a fixed-income strategist at broker RIA Capital Markets Ltd., said in a Bloomberg article. “The ECB continues to have an easing bias and therefore investors are happy.”

Meanwhile, Spain’s financial sector is appearing stronger, with the formerly bailed-out Bankia announcing quarterly profits almost doubled on increased margins and rate of defaults diminishes, Reuters reports.

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