Non-tech US equity funds attracted $62 billion in inflows over five weeks in early 2026, surpassing total flows for the entire year of 2025. Hedge funds are deleveraging from US tech positions at an unprecedented pace, with net selling observed in six out of eight weeks around mid-2026. Since June 22, software stocks have added approximately $1.5 trillion in gains while semiconductor makers lost roughly $2.6 trillion, a $4.1 trillion swing. The Russell 2000 small-cap index posted a 6% gain in early 2026, outperforming tech benchmarks due to more attractive valuations and sensitivity to domestic interest rate expectations. Insurance stocks hit record highs in late July 2026 as investors sought businesses with predictable cash flows and minimal exposure to the AI disruption narrative.
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