South Korea country-specific exchange traded fund is looking to break out as it tests its long-term resistance after picking up speed on improved automobile sales and rising smartphone demand.
The iShares MSCI South Korea Capped ETF (NYSEArca: EWY), which tries to reflect the performance of the MSCI Korea 25/50 Index, gained 12.0% over the past month and increased 11.3% over the last three months. EWY is now testing its 200-day simple moving average.
The South Korea ETF rallied as growth stocks fueled rebound off the late-summer lows. More recently, Samsung Electronics showed a better-than-expected third quarter result due to its semiconductor and display businesses, Jason Cipriani reported for Fortune.
Samsung posted quarterly revenue of 51.7 trillion Korean won, or $45 billion, up 8.9% year-over-year.
The tech giant has been riding the smartphone wave, capitalizing off chips for hand-held devices. Recently, Samsung split the contract for Apple’s A9 chip processor used in iPhone 6S and 6S Plus. The company’s chip business made up almost half of the company’s profit over the third quarter. Display panels also added to an impressive quarter.
EWY’s largest component holding is Samsung Electronics Ltd. at 22.0%. The tech sector is also the largest segment at 36.3% of the fund’s weight.
Additionally, South Korea’s auto industry also picked up in the third quarter, with Hyundai Motors Co revealing a 6.3% increase in car sales over October while Kia Motors posted a 16% surge in sales, Maria Levitov reported for Bloomberg.