Brazilian equities have nearly doubled this year, far outpacing the U.S. stock market.

EWZ

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The iShares MSCI Brazil Index Fund (EWZ) is up 98% year to date compared to 17% for the SPDR S&P 500 (SPY) over the same time period.

Brazil’s economy was relatively unscathed by the recession which lasted only 2 quarters and ended after the second quarter saw 1.9% growth.  The manufacturing and service sectors saw the strongest growth in Q2 as aggressive monetary-easing, government spending and tax cuts on consumer goods kicked in to revive the economy.

Investors may be optimistic partly due to the fact that the Brazilian government has already halted its invervention. Government spending actually declined in Q2 and central bankers indicated that monetary easing is over according to the Wall Street Journal story Brazil Exits Recession.

The $11 billion Brazil ETF is heavily weighted towards commodities which are beginning to bounce back due to demand from recovering global economies and a sliding dollar.  Top EWZ holdings include oil giantPetrobras, metals and mining specialist Vale and financial services provider Itau Unibanco Banco Multiplo.

Another Brazil ETF available to U.S. investors is the Market Vectors Brazil Small-Cap ETF (BRF).  Managed by Van Eck Global, the ETF tracks an index of stocks across several sectors of Brazil’s economy including homebuilding and consumer goods.

For more ETF investing choices, see the ETF Directory for a complete list of Country ETFs.