Flows are rotating into Aerospace & Defense Focus while Transport & Infrastructure Cohort weakens

🇪🇺 A clear flow shift is unfolding in equities, with a notable pivot away from transport and infrastructure and into defensive sectors. The largest outflow of nearly $2 billion from the Transport & Infrastructure Cohort, led by $AENA-MC, underscores a significant retreat from cyclical assets. Meanwhile, inflows into aerospace and defense, spearheaded by AVIO-MI with $672 million, confirm a rotation into more resilient themes. This transition signals a cautious tone among traders, favoring stability over cyclical exposure. The next test will be whether the defense focus sustains its inflow momentum or if broader market confidence returns to cyclicals. Watch for whether the defense inflow broadens beyond top leaders or if the transport outflows deepen, revealing a more persistent shift in market sentiment.