Unprecedented ETF Flows: $SPY Surges While $QQQ Faces Record Outflows

Last Friday, investors pulled a hefty $5.2 billion from the $QQQ NASDAQ 100 ETF, marking the most substantial single-day outflow since the dot-com bubble peak in 2000. Interestingly, historical patterns show that after such outflows, the NASDAQ 100 experienced a 70% decline over the following two years.

In contrast, the $SPY S&P 500 ETF experienced a record-breaking inflow of $21 billion on the same day, setting a new record for the largest single-day inflow ever for an ETF. This trend continued as investors added another $10.2 billion to $SPY the following day, making it the second-highest inflow ever, just slightly behind Friday’s historic record.

Notably, the S&P 500 ETF, $SPY, recorded its largest single-day inflow on record at $20.8 billion on Friday. This is unprecedented since the ETF’s inception in 1993. Last week alone, total inflows hit a staggering $24 billion, establishing a new record. This momentum persisted as $SPY witnessed an additional $10 billion of inflows yesterday, bringing the total to nearly $35 billion in just six trading days or an average of $5.8 billion per day.

Year-to-date total inflows for $SPY now stand at $50 billion, indicating that around 70% of the year’s inflows have occurred in the past six trading days. The market seems to be heavily relying on Federal Reserve Chair Powell maintaining a “Fed pivot” strategy, reflecting investor confidence in the central bank’s approach to economic policies.