Mexico-focused ETFs gained on news that the United States and Mexico have officially struck a deal, effectively revamping the current North American Free Trade Agreement. The iShares MSCI Mexico Capped ETF (NYSEArca: EWW) gained 2.86%, Direxion Dly MSCI Mexico Bull 3X ShsETF (NYSEArca: MEXX) jumped 9.46% and Franklin FTSE Mexico ETF (NYSEArca: FLMX) was 1.23% higher.
All three ETFs are in the green year-to-date with EWW up 6.82%, MEXX up 7.72% and FLMX up 7.07%. The Dow Jones Industrial Average climbed over 250 points following the new trade deal announcement.
“It’s a big day for trade,” said U.S. President Donald Trump at an Oval Office announcement. “It’s a big day for our country.”
According to President Trump, the deal would effectively eliminate the NAFTA name and would now be called The United States-Mexico Trade agreement. The Trump administration was pushing for a revamp of the NAFTA agreement prior to December 1 when Mexico turns over its leadership to the incoming administration of President-elect Andrés Manuel López Obrador.
With the differences ironed out with Mexico, the focus now shifts to other NAFTA member Canada.
“Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement,” said Adam Austen, a spokesman for Canadian Foreign Minister Chrystia Freeland. “We are in regular contact with our negotiating partners, and we will continue to work toward a modernized NAFTA. We will only sign a new NAFTA that is good for Canada and good for the middle class. Canada’s signature is required.”