Don't fight the bull market in Spain-instead look at the investment opportunity there may be in a Spain ETF. iShares MSCI Spain (NYSEARCA:EWP) is up 9% year to date and was one of the top ETF performers for 2006, up 48%. EWP has holdings in finance and telecommunications, including Banco Santander Central Hispano 19% and Telefonica SA 17%.
Spain's economy has been fueled by consumer spending, easy debt, immigrant labor, and a booming building/housing industry, well above the European Union average for over a decade. There is an overall sense of optimism in the population and there are cranes on every horizon to build on this can-do mentality.
Rumor has it some Spaniards are even giving up "siesta" and working harder and longer. However, Tracy Wilkinson for The Los Angeles Times warns that the pillars of growth are construction, housing, banking and tourism - all of which cannot be sustained forever and do little to further productivity.
Nevertheless, Spain has the fastest growing immigrant population and is the country of choice for European job seekers. The Spanish acceptance of immigrants exceeds that of any other European country. Spain's drive for growth has led it into its most intense and longest period of expansion since becoming a market democracy in the late 1970's.
EWP 1-yr chart: