Tech Exodus Masks a Broad Risk-On Surge

Institutional money poured into equities and bonds last week. The overall tone is risk-on, but the cracks inside sectors tell a sharper story.

Equity ETFs pulled in $30.0B net in the past week. Fixed income added another $10.1B. Commodities were the one clear loser, shedding $4.5B as investors rotated away from defensive stores of value.

Geography Flows

The U.S. led all regions with $13.7B in net inflows over the week. Japan came in second at $9.3B, with a strong flow imbalance score of 73.5 — well above the 65 threshold that signals genuine buying pressure.

Developed Markets ex-North America and Developed Markets ex-U.S. both showed imbalance scores above 85. That points to concentrated, directional buying rather than balanced two-way flow.

China attracted $1.1B net, but its flow imbalance sat at just 53. Gross flows were enormous — $9.3B in, $8.2B out — meaning traders are actively churning positions rather than building them.

The 3-month picture confirms U.S. dominance at $476.9B net. Japan accumulated $155.1B over the same period. Global ETFs added $104.4B over three months, but flipped to a $606M outflow in the past week — a notable short-term reversal worth watching.

India and the U.K. both saw small outflows this week, reversing their positive 3-month trends. Asia-Pacific ex-Japan posted a weak imbalance of just 14.8, suggesting selling pressure in the sub-region.

Sector Rotation

The headline number is brutal for tech. Information Technology ETFs bled $6.5B last week. That is the single largest sector outflow by a wide margin. The flow imbalance dropped to 34.8 — deep into selling territory.

This is a stark reversal. Over three months, IT was the biggest sector winner at $65.5B net. The week's move suggests profit-taking after a prolonged run-up.

Where did the money go? Consumer Discretionary took $548M. Industrials absorbed $335M. Health Care and Real Estate each collected around $300M. All four show positive imbalance scores above 53, confirming broad-based rotation rather than a single destination.

Energy picked up $200M this week. That reverses its 3-month trend, where it lost $4.6B — the biggest sector outflow over that longer period.

Asset Class and Strategy

Equities dominate both timeframes. Over three months, equity ETFs accumulated $877.9B. Fixed income added $235.2B. Commodities lost $30.5B over three months and continued bleeding last week.

On strategy, passive Vanilla flows led at $17.3B for the week. Active strategies added $9.1B, matching their strong 3-month pace. Active's flow imbalance of 74.6 this week signals sustained institutional conviction.

Growth strategies flipped sharply. Over three months they attracted $103.3B. Last week they shed $659M. That matches the tech selloff — growth and tech tend to move together.

Price-weighted ETFs also reversed, losing $1.7B this week after gaining $4.9B over three months. Low Volatility strategies, however, continued to attract steady inflows, hinting at some defensive repositioning beneath the surface.

The overall tone is risk-on, with equities and bonds both in demand. The key shift is inside equities: money is leaving tech and growth, and rotating into cyclicals, defensives, and income-oriented strategies.