Sector Rotation Detector · Weekly Scan · Public preview

5 sectors are rotating · 6 stable

Scan day · Saturday, August 8, 2026

Five sectors flipped leadership regimes this window versus the same July-August calendar block one year ago. The dominant story is a defensive unwind: XLU crashed from +3.1pp of relative strength last year to -6.2pp now — the widest swing on the board (9.4pp) and the largest single move in the scan. On the other side, three cyclicals turned decisively positive from deep laggard positions a year ago — Materials (+8.1pp swing, driven by a violent gold-miner bid), Energy (+7.7pp, oil complex reasserting on tighter physical balances), and Financials (+4.0pp, riding a steeper curve and quiet regional-bank accumulation). Technology quietly flipped negative on a 2.5pp swing even as XLK closed the window green — the abs value hides an ugly mid-window drawdown that saw SMH bleed nearly $12B of net outflow before the semiconductor tape stabilized. The most surprising rotation is not the utilities collapse, which was telegraphed by the rate move, but the money-flow divergence inside Materials: GDX absorbed $10.3B of net inflow over the last ten sessions — more than the entire XLB sector fund saw — signaling that the "materials bid" is really a monetary-metals bid dressed as a cyclical rotation. Non-rotating sectors are uniformly stable-negative: XLV, XLRE, XLI, XLC, XLP all trailed SPY in both windows without flipping sign.

Headline rotation — fully revealed

Utilities

XLU

Turning negative ↘

RS · now-6.2%

RS · 1 yr ago+3.1%

Top ETF (by 10d flow)FUTY

Thesis

Utilities are being aggressively unwound after a 2025 run in which they beat SPY by 3.1pp. The trigger is the term-premium re-widening at the long end: with 10y yields grinding back toward the top of their range and equity risk premium compressing, the bond-proxy trade has no marginal buyer. Flow evidence is overwhelming — the sector fund saw negative money flow on 8 of the last 10 sessions and shed roughly $6.1B of net proxy outflow, and every one of the four liquid alternatives (FUTY, IDU, VPU) is negative as well. This is coordinated selling across every fund type in the sector, not a wrapper-shift story.

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Utilities

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