Italian shares have been under considerable pressure of late on concern about this weekend's referendum, but the FTSE MIB is far outperforming other indices today with a 2.25% advance.
Many are expecting a "no" vote, which could lead to the resignation of the prime minister, and even more pressure on the country's teetering banks.
The sharp reversal in Italian shares today (and yesterday) suggests perhaps a few are placing bets on a surprise outcome. MarketWatch notes EWI is ahead 1.8% today on sharply higher volume, and the $432M fund has seen $38M of inflows over the last week compared to nearly $400M exiting YTD.
Also on the move is the iShares Currency Hedged MSCI Italy ETF (HEWI +2.3%).