Money Flows to US and Japan, ESG Falls Out of Favour

US-listed ETFs pulled in $37B net in the past week alone. That tops every other geography by a wide margin. The flow imbalance sits at 70.5, a clear buying-pressure signal. Over three months, the US haul reaches $373B, confirming a durable trend rather than a short-term spike.

Geography Flows

Japan is the standout story beyond the US. It attracted $12.4B in net inflows this week. Its flow imbalance of 81.1 signals strong buying pressure. The three-month figure of $158B backs that up. Institutional money is rotating into Japanese equities with real conviction across both timeframes.

China drew $6.4B this week, but the three-month picture is far more muted at just $5.9B. The week-to-month gap suggests a burst of short-term positioning rather than a structural allocation shift. Taiwan added $1.3B this week and $20.7B over three months, consistent with ongoing semiconductor demand narratives.

Hong Kong stands out as the key regional loser. It bled $729M this week and $9B over three months. Its flow imbalance of 36.9 shows persistent selling pressure. India flipped negative this week at -$319M, a notable reversal from its roughly balanced three-month reading.

Sector Rotation

Information Technology leads all sectors with $2.4B in net weekly inflows. However, its flow imbalance is only 55.3 — barely above neutral. That means gross flows are large but largely offsetting each other. The three-month haul is massive at $66.5B, but the weekly pace has slowed.

Financials took in $1.1B this week. Consumer Discretionary added $607M. Both show stronger weekly imbalance readings than Tech. Energy is losing ground on both timeframes: -$198M this week and -$4.4B over three months. Communication Services is also in the red this week at -$134M.

Materials saw $424M of inflows this week. Over three months, it posted a -$793M net loss. That is a meaningful reversal. Money is moving back in after a period of outflows.

Asset Class and Strategy

Equities dominate. They pulled in $66.8B net this week, roughly 7x the $9.8B that went into Fixed Income. Over three months, the gap narrows: $783B into equities versus $233B into bonds. Bond buying has been steadier; the weekly pace of equity inflows is accelerating.

Commodities tell a stark story. They drew $855M this week, a positive number. But over three months, they posted a -$31B net outflow. Short-term buyers may be fishing for a bottom.

On strategy, Active management pulled in $6.8B this week with a 71.4 imbalance. Over three months, Active gathered $229B — second only to Vanilla passive flows. ESG is clearly under pressure. It lost $664M this week against a three-month net gain of $8.6B. The imbalance this week is just 42.6, pointing to net selling. Price-weighted strategies also bled $1.8B this week, despite a positive three-month reading.

Overall, the picture is firmly risk-on. Equities are winning over bonds. The US and Japan are the preferred destinations. ESG and Energy are the clear losers of the week.