Top 3 Foreign ETFs Of Q2

International investing has been extremely upbeat lately on the improving health of several economies. Policy easing has played a major role in driving global economic growth over the last couple of quarters. Be it Euro zone or emerging markets – all overseas regions grabbed investors’ attention in the second quarter.

First of all, most developed economies – that faced deflationary threats so long – are slowly returning to the inflationary track. Notably, Japan and the Euro zone are still pursuing an ultra-easy monetary policy along with quantitative easing. A wave of cheap money in these international nations have stepped up economic activities, and increased business and consumer confidence.

Also, a pickup in economic activity in many parts of the world, robust corporate earnings and lower-than-expected political upheaval in Europe have led to this outperformance. Additionally, the fading Trump rally pushed investors to foreign stocks from the U.S.

Meanwhile, the Euro zone silently surpassed the U.S. economy on the growth front in 2016. The ECB projected Euro Area’s growth at 1.9% in 2017, 1.8% in 2018 and 1.7% in 2019.

Japanese economic growth outlook, though still not-steady, is a positive. Japan’s core inflation (excluding food) increased for the fifth successive quarter in May 2017. It grew 0.4% in the month compared with 0.3% in April, marking the quickest clip in more than two years.

On the other hand, emerging market growth prospects also remained steady in that frame. Some of other reasons for this outperformance were a subdued greenback, commodity market strength and policy easing in several EM economies.

Overall, all world ETF iShares MSCI ACWI ETF ACWI) added 4.7% in Q2 while the key U.S. ETF SPDR S&P 500 ETF (SPY – Free Report) advanced about 3.3%. Europe ETF Vanguard FTSE Europe ETF (VGK – Free Report) jumped 8.9%, emerging market fund iShares MSCI Emerging Markets ETF (EEM – Free Report) gained about 5%, iShares Asia 50 ETF (AIA – Free Report) gained 8% andiShares MSCI All Country Asia ex Japan ETF (AAXJ – Free Report) added over 6.8%. This clearly shows the upper hand that international equities enjoyed in Q2.

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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