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Time For The U.K. ETF?

|Includes: BHP, BP p.l.c. (BP), RDS.A
By Jason Raznick

Economic reports can light a fire under country-specific ETFs or they can illicit little response. News that the U.K.'s GDP grew 1.1% in the second quarter may not sound earth-shattering, but consider that this is the best growth report in four years from the U.K. and it may time to take a look at the iShares MSCI United Kingdom Index Fund (NYSEARCA:EWU).

Economists forecast a 0.6 percent gain, according to the median of 32 predictions in a Bloomberg news survey. That beat may be enough to, at least in the near-term, give investors more confidence about the global economic recovery and provide EWU with a boost.

The ETF recently broke above a long-term downtrend line and has its sights set on clearing the 200-day moving average just above $15.50.

BP (NYSE:BP) has been a drag on EWU as it is the ETF's largest holding, in turn dragging down another top EWU constituent, Royal Dutch Shell (RDS-A), but BHP Billiton (NYSE: BHP) has had some good things to say last week. Factor in the notion that the worst is probably behind shares of BP, and EWU becomes a bit more inviting.

If nothing else, the GDP report put EWU in play in Friday's trading session and the ETF could also be worth a look as a medium-term trade.

Disclosure: No Position