China Leads as US Loses Ground

China pulled in $8.1B in a single week. That is the standout story in global ETF flows right now. It topped every other geography. Meanwhile, US-focused funds bled $4.0B over the same period — a sharp reversal from their dominant $470B haul over the past three months.

Geography Flows

China's $8.1B weekly inflow came with a flow imbalance of 63 — buyers clearly in control. Japan added $5.0B. Global funds attracted $4.4B. Together, these three drove the bulk of non-US demand.

The US turned net negative this week at -$4.0B. Over three months it led all geographies with $470B in net flows. That divergence is significant. Either profit-taking is hitting US ETFs after a strong run, or investors are actively rotating into international markets.

Taiwan and Emerging Markets each added roughly $2.6B this week. Both carry high flow imbalance scores — 88 and 85 respectively — signalling strong, one-sided buying pressure.

South Korea bucked the trend. It lost $1.4B this week despite pulling in $32.8B over three months. UK ETFs also saw outflows, with a flow imbalance of just 18 — heavily skewed to sellers.

Sector Rotation

Technology took the hardest hit. Information Technology ETFs shed $4.7B this week. That is a significant weekly reversal for a sector that dominated the three-month window with $67.7B in net inflows — the largest of any sector over that period.

Industrials lost $2.1B. Financials dropped $1.3B. All three were net sellers this week.

Energy was the brightest spot. It attracted $672M this week. That compares to a $4.2B outflow over three months — a clear trend reversal worth watching.

Consumer Staples added $414M. Health Care brought in $308M. Both defensive sectors showed modest but consistent buying.

Asset Class & Strategy

Fixed Income and Equity ran almost neck-and-neck this week. Fixed Income pulled in $24.3B. Equity matched it at $24.0B. Both showed strong demand, suggesting investors are not abandoning risk but are also hedging with bonds.

Over three months, Equity dominated with $878B in net inflows versus $233B for Fixed Income. Commodities lost $31.3B over three months and shed another $2.5B this week.

On strategy, Vanilla ETFs led with $20.4B this week. Active funds added $11.0B — their flow imbalance hit 74, the highest of any major strategy group. Active ETF adoption is accelerating. Over three months, Active also ran second to Vanilla with $230B in flows. Growth strategies pulled in $104B over three months but saw mild outflows this week, another sign of near-term rotation away from momentum names.

The overall tone is cautious rotation. Money is moving out of US equities and tech into international markets, bonds, and defensive sectors — a mild risk-off shift after a sustained bull run.