US technology funds recorded net inflows of $14.3 billion in the week ending July 1, marking the second-largest weekly inflow in history. The four-week moving average also rose to a record high of $9.0 billion, with the annualized rate projected to reach $152 billion by 2026.

What's truly remarkable is not the figure itself, but the sharp fluctuations it represents. Two weeks ago, technology funds saw inflows of $19.2 billion; last week, this completely reversed, with outflows of $9.3 billion; and now we are witnessing a strong recovery. This three-week zigzag demonstrates the volatile and rapidly shifting nature of market appetite for the technology sector, with capital movements constantly changing direction instead of a stable trend.
This is further evidenced by the fact that broad-based US equity funds experienced their largest weekly outflow since March during the same period. According to a Bank of America report based on EPFR data, US equity funds saw outflows of $17.2 billion in a single week. This doesn't necessarily mean the market has crashed, but it indicates that investors are becoming more cautious after a period of strong rally. During the same week, global equity funds attracted a total of $10.4 billion in inflows, with Asian equity funds recording their strongest inflow in seven weeks, totaling $7 billion, while US funds saw limited inflows of around $1 billion. This is a clear sign of rotation; capital appears to be shifting away from US and technology concentrations to regions with less valuation pressure. However, technology funds themselves continue to attract strong inflows independently of this rotation, suggesting that both are occurring simultaneously.
A strategist at BNY interpreted this as a sign of fatigue in the AI-focused rally, and the MSCI World Index also fell 2.07% last week amid concerns about concentration risks and spending plans by large cloud companies. On the other hand, BNP Paribas's head of Asia Pacific equity research stated that the bank's technology analysts see no signs of a slowdown in the sector's earnings momentum and expect the second-quarter earnings season to be supportive. So, even among institutions, there's no clear consensus on what this data means.
The real significance of this picture is that it shows capital is now aggressively concentrating not on the broad-based US market, but directly on the technology and semiconductor sector. Such a concentration can lead to sharp rises when news supporting the sector emerges, but it also carries the risk of equally sharp pullbacks in the event of any negative surprises. For those following both equity and crypto markets through Gate, the key point to watch is whether this three-week zigzag of ups and downs will stabilize in one direction in the coming weeks, because the current picture shows less of a clear trend reversal and more how fragile the market's confidence in the technology sector has become.
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