Sector Rotation Detector · Weekly Scan · Public preview

1 sector is rotating · 10 stable

Scan day · Saturday, September 26, 2026

One sector clears the isRotating bar this scan: Consumer Discretionary (XLY) has flipped from mildly leading SPY a year ago (+0.20pp) to sharply lagging (−4.62pp) — a 4.82pp swing. SPY itself is essentially flat over the last 30 days (+0.03%) versus +2.35% in the same window one year ago, so the current tape is a compressed one where relative-strength differences get amplified. Every sector except XLK (+4.06%) and XLC (+1.39%) is red on the month. The single surprise is not XLY, which was well-flagged, but the depth of Utilities weakness (−8.50%) after a year in which XLU quietly hugged SPY — rate-sensitives (XLU, XLRE) and non-Tech cyclicals (XLY, XLI, XLB, XLF) are all bleeding while Tech has widened its lead. This is the shape of a market rotating INTO large-cap Tech / AI-capex names and OUT of nearly everything else, with policy-rate expectations firming rather than easing.

Money flow inside Consumer Discretionary confirms the rotation is real: all five liquid sector wrappers printed net 10-day OUTFLOWS. XLY itself shed roughly $2.3B of net proxy flow, the deepest of the group by two orders of magnitude, and the smaller satellites (FXD, IYC, VCR, FDIS) never attracted the bid a rotation-into-discretionary would produce. When the primary sector ETF is dumped this hard while every satellite is also negative, it isn't tax-lot noise — it is allocation.

Headline rotation — fully revealed

Consumer Discretionary

XLY

Turning negative ↘

RS · now-4.6%

RS · 1 yr ago+0.2%

Top ETF (by 10d flow)FXD

Thesis

Consumer Discretionary flipped from a modest year-ago tailwind (+0.20pp vs SPY) to a hard 4.62pp deficit. The proximate driver is the retail complex re-pricing to a higher-for-longer rate path: the September 2026 hike sequence has re-tightened effective mortgage and auto financing costs, and softer late-summer jobs prints have removed the wage tailwind that carried the group in 2025. AMZN, TSLA and HD are roughly 40% of XLY and each lagged SPY by 4-8pp in the window. The critical tell is money flow: all five liquid wrappers printed net 10-day OUTFLOWS, with XLY alone shedding ~$2.3B of proxy flow. Watch holiday-quarter guidance in the Q3 prints — a soft read there likely extends this leg.

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Consumer Discretionary

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