High-frequency foreign portfolio flows into US and emerging-market assets Report Interpretation

Overview

This weekly Nomura update tracks high-frequency foreign and Asian investor flows into US equities, US bonds and EM-focused ETFs. Its central finding is a renewed foreign preference for US equities during 31 August–4 September, contrasted with worsening US bond-fund outflows.

Core views

Foreign inflows into US-focused funds totaled USD2.4bn between 31 August and 4 September, up from USD731mn over the preceding five sessions. The aggregate improvement was entirely equity-led: foreign inflows into US-focused equity ETFs and mutual funds accelerated to USD3.2bn from USD1.1bn in the prior week, while US-focused bond ETFs and mutual funds recorded USD832mn of outflows, widening from USD332mn previously. For September month-to-date through 4 September, US-focused funds received USD2.5bn overall, comprising USD2.4bn into equities and only USD72mn into bond funds. The monthly comparison underscores the relative strength of equity demand. US-focused equity funds had already attracted USD10.9bn in August 2026, while US-focused bond funds had seen USD1.0bn of outflows. The latest weekly data therefore indicate that foreign demand for US equities resumed strongly at the start of September, whereas demand for US bonds remained weak despite a small positive month-to-date bond-fund inflow. EM-focused ETFs continued to receive foreign capital, though at a slower pace. Inflows totaled USD1.1bn during 31 August–4 September after USD1.4bn in the prior week. The weekly total included USD1.6bn of equity-fund inflows and USD434mn of bond-fund outflows. September month-to-date EM fund inflows were USD435mn, following USD8.8bn in August 2026, again showing positive equity demand alongside bond-fund withdrawals. Asian investor-flow indicators were mixed. Korean retail investors net bought USD410mn of US portfolio assets during the latest week, down from USD1.2bn previously as net buying of US equities slowed. The latest total consisted of USD102mn of US-equity purchases and USD308mn of US-bond purchases. Korean retail investors had purchased USD0.7bn of US assets month-to-date in September after USD3.8bn in August. In Taiwan, exchange-listed USD bond ETFs received USD124mn of inflows, modestly above USD109mn in the prior week; Taiwanese investors had net bought USD93mn of USD-denominated bonds month-to-date, compared with USD476mn in August. The report uses fund-listing-based proxies to track foreign flows. For US-focused equity and bond funds, it assumes that funds listed on non-US exchanges are primarily held by non-US retail investors. For EM-focused funds, it assumes that funds listed in non-EM markets are primarily held by foreign investors. The latest weekly observations cover five sessions through 4 September, and the prior-week comparator is the preceding five sessions.

Analysis framework

Nomura compares weekly and month-to-date fund-flow data across US-focused equity and bond ETFs and mutual funds, EM-focused ETFs, Korean retail purchases of US assets, and Taiwanese USD bond ETFs. It interprets the composition of flows between equities and bonds to identify where cross-border investor demand strengthened or weakened.

Methodology notes

• Other

  High-frequency foreign-flow proxy based on the listing location of ETFs and mutual funds

  The report infers foreign investor flows by treating US-focused funds listed outside the US as mainly held by non-US retail investors, and EM-focused funds listed outside EM markets as mainly held by foreign investors.

Key data

• US-focused fund foreign flowsUSD2.4bn31 August–4 September, up from USD731mn in the previous week
• US-focused equity-fund inflowsUSD3.2bnLatest week, accelerating from USD1.1bn previously
• US-focused bond-fund flows-USD832mnLatest-week outflows, versus -USD332mn in the previous week
• EM-focused ETF inflowsUSD1.1bnLatest week, following USD1.4bn in the previous week
• Korean retail net purchases of US assetsUSD410mnLatest week, down from USD1.2bn previously
• Taiwan USD bond ETF inflowsUSD124mnLatest week, following USD109mn in the previous week

Impact & implications

The report indicates a short-term divergence in foreign portfolio positioning: demand strengthened for US equities, while foreign investors withdrew further from US-focused bond funds. EM flows stayed positive overall but were also supported by equities rather than bonds.