Money Flows East as Tech Grabs the Week

US equities remained the single largest destination for ETF money this week. But the most telling signal sits underneath: China pulled in $10.3B in net flows over seven days. Its flow imbalance hit 76.5, showing strong buying pressure. Over three months, China posted $16.9B in net inflows. The direction is consistent and the pace is accelerating week-on-week.

Geography Flows

$33.6B flowed into US-focused ETFs in the past week. That is the biggest absolute number by far, with a flow imbalance of 66.2. Taiwan added $5.3B over the week, almost entirely one-directional: its imbalance reached 95.9, meaning nearly all gross flow was inward. Brazil and Developed Markets Ex-US also posted strong numbers, each above $2B net and with imbalances in the high 90s.

The one notable reversal is Developed Europe. It posted a net outflow of $900M this week. Over three months it was solidly positive at $7.4B. That is a clean trend break worth watching. Japan is the mirror image: a $2.7B inflow this week, but a $6.8B net outflow over three months. Short-term bounce, long-term doubt.

India also flipped negative on the week ($63M outflow, imbalance 12.3) after three months of sustained selling ($1.2B outflow). Singapore reversed the other way: negative over the short term but positive over three months.

Sector Rotation

Information Technology drew the largest sector inflow over the week at $9.4B. That is also the sharpest turnaround from the three-month view, where IT posted only $2.0B net as gross flows nearly cancelled out. Short-term enthusiasm for tech has returned.

Financials and Industrials each shed money on the week. Financials lost $2.5B in net flows, with a flow imbalance of just 19.3. The three-month picture is worse: Financials recorded the largest sector outflow at $10.5B. Industrials lost $1.5B this week and $3.0B over three months. Both sectors are seeing consistent selling pressure.

Health Care and Energy are quiet positives. Health Care took in $642M this week and nearly $2.9B over three months. Energy collected $494M this week and $2.3B over three months. Real Estate flipped: $270M outflow this week after $3.2B of inflows over three months.

GM reports on 20 October and TSLA on 21 October. German car registration data, which ORTEX data tracks as a leading indicator of revenue for both, is running at plus 133% and plus 269% respectively year-on-year for the same quarter. That is the backdrop against which IT and consumer-facing sector flows are being placed this week.

Asset Class and Strategy

Equity ETFs took in $68.6B on the week. Fixed income added $15.1B. The ratio is roughly four-to-one in favour of equities, a clear risk-on lean. Commodities attracted $2.1B, with a flow imbalance of 70.3. Over three months, fixed income pulled $298B versus equities at $500B, suggesting the risk-on skew is a recent development rather than a durable trend.

On strategy, vanilla passive funds dominated with $49.2B in weekly net inflows. Active strategies drew $4.3B. The bigger story is growth versus ESG. Growth funds posted $3.3B inflows this week with an imbalance of 83.1. ESG bled $498M in net outflows and had an imbalance of just 44.0. Over three months, ESG was solidly positive at $9.5B, so the weekly reversal is a notable change in tone. Low volatility funds also saw outflows this week after minimal net movement over three months, consistent with the broader risk-on posture.

The week's overall tone is risk-on: equities over bonds, growth over defensives, Asia over Europe, and tech back at the top of sector flows.