Don Dion's Weekly ETF Blog Wrap

NEW YORK (TheStreet) -- Don Dion posts his current insights on the stock, bond, commodity and currency markets in his RealMoney blog, anticipating which ETFs will be in play next. Among his blogs this week were the following, in which he wrote about Korea's economy, challenges for steelmakers and how China is pressuring the solar industry.

Korean GDP Jump Boosts EWY

Posted 10/27/2009 7:07 a.m. EDT

Korean GDP increased 2.9% quarter on quarter in the three months to September and 0.6% versus the same period last year, the Bank of Korea said Monday. It was the briskest quarterly growth rate in seven years and the first positive year-on-year quarter in 12 months, leading officals to comment that GDP could even swing into positive territory for 2009 if the trend continues. The central bank had previously forecast GDP to contract 1.6% this year.

The news lifted the Kospi index and filtered through to a 0.6% gain for iShares Korea (EWY) yesterday, even in the face of a dollar rally and equity sell-off in the U.S.

Signs of a reinvigorated economy have investors excited about Korea, but the country has relied on inventory rebuilds for some of its economic expansion. Government spending declined in the quarter as the administration pared back its stimulus expenditure.

With a 65% return year-to-date, EWY has joined the ranks of iShares Taiwan (EWT), iShares Sweden (EWD) and iShares Emerging Markets (EEM). Going back two years, EWY has been one of the worst performers among international ETFs, suggesting it may have much more ground to recover if Korea's economy helps to lead the way out of global recession.

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