Tech Bleeds While Bonds Win This Week

Japan dominates the headline this week. ETFs tracking Japanese equities shed a net $69B in seven days, with a flow imbalance of just 14.8 — heavy selling pressure. That single outflow dwarfs every other geographic move combined. Over three months, Japan was still a net winner at +$62B, so this week marks a sharp reversal from a multi-month trend.

Geography Flows

The US held up reasonably well. American equity ETFs pulled in a net $4.6B this week, with flow imbalance sitting at 51.9 — roughly balanced. Over three months, the US picture looks far stronger at +$354B, the largest geographic inflow of the period.

China also reversed course. A net outflow of $8.3B in the past week contrasts with a +$22B inflow over three months. That is a meaningful divergence. Sentiment turned negative fast.

On the bright side, Emerging Markets drew $2.1B this week with a flow imbalance of 88.1 — near one-sided buying. Developed Markets Ex-US attracted $1.5B, and Developed Europe picked up $668M. Switzerland and South Korea also posted clean inflows.

Sector Rotation

Information Technology was the biggest loser across sectors. It bled $3.3B in the past week, with a flow imbalance of just 39.0. Over three months, Tech was the single biggest sector winner at +$72B. This week's reversal is the most striking sector signal in the data.

Materials stood out as the clearest weekly winner at +$2.1B, with a flow imbalance of 85.3. Energy edged up $218M. Health Care slipped $364M, and Financials shed $209M.

Over three months, Health Care added $6.9B and Real Estate pulled in $5.9B. Energy was the only sector with a three-month net outflow at -$6.4B — yet it is attracting short-term inflows this week, suggesting a possible tactical rotation into the beaten-down sector.

Asset Class & Strategy

Fixed Income was the clear winner at the asset class level. Bonds drew $15.7B in net inflows this week against a flow imbalance of 69.4 — solid buying pressure. Commodities added $5.5B, the second-best performer. Equities as a whole posted a large net outflow of $59.3B, though this partly reflects massive gross flows in both directions.

Over three months, equities pulled +$705B in net inflows, underscoring that this week's equity selling is a short-term shift rather than a structural trend.

On strategy, passive (Vanilla) ETFs saw $82B leave in a week. Active strategies bucked that trend with $8B in net inflows and a flow imbalance of 79.5. Over three months, Active funds collected +$221B — the second-largest haul after Vanilla's +$330B. The shift toward active management is one of the clearest sustained trends in the data. Value strategies pulled $1.4B this week. Growth ETFs shed $187M.

The overall tone is cautiously risk-off. Money is rotating from equities and passive growth into bonds, commodities, active managers, and value — with Japan's sharp reversal the biggest single story of the week.