China Surge Leads a Risk-On Week

China ETFs pulled in a net $25.1B in the past week. That beat US-focused funds ($20.8B) for the top spot on weekly geography flows. The gap is striking: over three months, the US leads all geographies with $286.6B of net inflows, while China sits third at $57.9B. The weekly reversal suggests fresh positioning in Chinese assets, not a continuation of the longer-term trend.

Japan tells the opposite story. It ranks third by weekly inflows at $4.5B but shows a net outflow of $21.8B over three months. That is the sharpest three-month reversal in the geography table. Money has been leaving Japanese ETFs at scale, even as this week sees a brief counter-flow. Taiwan attracted $4.3B this week and $18.1B over three months, holding steadily popular with allocators.

Geography Flows

Asia dominates the buying list at both time horizons. China's weekly flow imbalance of 82.4 out of 100 signals strong buying pressure. South Korea added $1.9B this week. Among the losers, North America (ex-US) bled $452M this week, flipping from modest three-month inflows. Brazil and Hong Kong both saw small outflows this week after recording positive three-month trends. That is a mild deterioration for emerging-market adjacent plays. Developed Europe managed only $221M of net inflows this week despite being broadly positive over three months, with $6.8B accumulated since August.

Sector Rotation

Information Technology leads all sectors at both horizons. It drew $2.6B this week and $11.8B over three months. Financials show the starkest divergence. This week sees $884M of net inflows. Over three months, Financials bled $9.5B. That is the largest three-month sector outflow in the data. Allocators appear to be selectively returning to banks and insurers after a difficult summer. Materials flipped sharply negative this week at minus $637M, having been solidly positive over three months at $785M. Industrials remain under pressure at both time horizons, with minus $373M this week and minus $1.5B over three months. Energy held steady on both: $573M this week and $2.8B over three months. Health Care also saw consistent inflows at both windows, $648M this week and $3.4B over three months.

Asset Class and Strategy

Equities dominate, pulling $64.4B this week against $4.2B for fixed income. The gap is wide. Over three months the picture shifts considerably: equities still lead at $536.5B, but fixed income gathered $285.7B, a much larger share of total flows than the weekly number implies. Bond demand has been building steadily while this week's snapshot looks more heavily equity-skewed. Commodities saw negligible net flow this week at $113M, against a solid $32.7B over three months. Currencies saw outflows this week of $1.1B, reversing a three-month positive. Among strategies, vanilla passive funds took $44.0B this week. Active strategies added $6.5B, maintaining the strong pace seen over three months where active gathered $159.3B, a 71.8 out of 100 imbalance score. Growth strategies pulled $3.6B this week and $20.3B over three months. Value added $1.2B this week and $7.9B over three months. Momentum has been a notable loser over three months at minus $3.8B, even as it scraped a small positive this week.

The overall tone is risk-on, with equities preferred, Asia driving geography flows, and technology leading sector allocations. The bond build over three months acts as a partial hedge beneath the surface.