Where Is The Money Flowing?

Research Notes May 2026 > https://www.unum.capital/post/rmay2026

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Analyst Disclosure: Using our technical screens, the following analysis was compiled using an artificial intelligence tool.

Data extracted from the screeners reveals a market undergoing a massive structural rotation away from high-beta US technology and into global value, hard assets, and sovereign-backed monopolies. The screens confirm that professional capital is aggressively fading expensive semiconductor names and hunting for low-multiple carry trades in international markets.

While US Large Caps are not completely abandoned, the velocity of money is clearly chasing the “forgotten” global heavyweights: international banks, traditional energy, and defensive telecoms. The risk tolerance is highly specific—participants are willing to absorb geopolitical risk (China, Middle East) to escape extended US tech valuations, signaling a preference for current cash flow over future growth promises.

Size & Style Factors 📏🎨

Small Cap 🐜: Cold / Faded. True small-cap momentum is absent from the top tier of these screens. Capital is actively seeking the safety of balance sheets, making the speculative end of the market uninvestable for trend-followers right now.

Mid Cap ⚖️: Targeted. The strength here is highly specific to international industrial and financial names (Hana Financial, Bank of Chengdu). It is a stock-picker's market for Mid Caps, not a broad beta trade.

Large Cap 🐳: Dominant (Ex-US). Mega-cap global banks and energy behemoths (Saudi Aramco, CCB, HSBC, UBS) are utterly dominating the individual thrust lists. Size is being used as a defensive moat.

Value 🏷️: Extreme Conviction. Value is the absolute driver of current momentum. The screens are saturated with low-multiple sectors (Banks, Telecoms, Energy, Coal). The market is ruthlessly rewarding fundamental valuation and tangible book value.

Quality 💎: Elite Moats. Capital is demanding structural safety. The presence of sovereign-backed entities and critical infrastructure indicates a bias toward monopolies and firms that cannot be easily disrupted.

Growth 🚀: Fracturing. The "Would Not Enter a Buy Long" screen is highly concentrated with Semiconductor stalwarts (AMD, TXN, ON, STM). Professional money is fading the hardware supercycle. Growth is no longer a monolith.

Momentum 🌊: Concentrated Value. The paradox of the current market: the strongest technical momentum resides in the most "boring" value stocks. The trend has inverted from tech-led to value-led.

Risk, Yield & Investment Factors ⚠️🏭

Low Volatility 🛡️: Elevated. Telecoms (Orange, Vodafone, AT&T) and Utilities appearing in breakout lists confirm that institutions are hedging their equity exposure with low-beta stalwarts.

High Yield / Dividend 💰: Strong Bid. The rotation into European banks, telecom, and traditional energy is a massive hunt for yield. Total return (price appreciation + dividend) is the primary objective as capital front-runs potential rate cuts.

Profitability 📊: Absolute Requirement. The screens systematically filter out non-earners. Speculative revenue stories are dead; trailing profitability is mandatory for inclusion in the current flow.

Liquidity 💧: Sovereign-Grade. Flows are concentrated in the most liquid instruments on earth—national champion banks and state oil companies. Institutions want guaranteed exit liquidity.

Carry 🎒: Aggressive. The dominance of global financials and telecommunications acts as an equity-based carry trade, capitalizing on yield differentials.

Investment (Capex) 🏗️: Physical World. Strength in Heavy Machinery (Sumitomo, Nidec) and Global Infrastructure points to a sustained capex supercycle, entirely separate from digital tech.

Thematic, Regional & Sector Factors 🌍🏢

Defensive 🏰: Peak. The aggressive accumulation of Consumer Staples (Alimentation Couche-Tard, Carlsberg) and Healthcare (UnitedHealth, Sun Pharma) highlights a deeply defensive undercurrent.

Cyclical 🔄: Old Economy. "New" cyclicals (consumer discretionary) are weak, but "Old" cyclicals (Coal, Refiners, Heavy Machinery) are seeing massive capital inflows.

ESG 🌿: Ignored. Absolute disregard for ESG constraints. The heavy presence of Coal (China Coal Energy), Oil (TotalEnergies, Petrobras), and Defense signals that performance is overriding mandate restrictions.

Multi-Factor 🧩: Active. The winning strategy combines Yield + Value + International presence.

US 🇺🇸: Selective. No longer the default destination. Capital is holding select US mega-caps (AAPL, UNH) but breadth is poor.

ex-US 🌍: On Fire. The clear winner of the current rotation. Money is flooding into Europe, Asia, and the Middle East seeking relative value.

Developed Markets 🏙️: Bifurcated. European Banks and Japanese Industrials are thriving; US Tech hardware is lagging.

Emerging Markets 🐅: Red Hot. China (Financials/Industrials) and India (Infrastructure/Pharma) are acting as the primary global momentum engines.

Frontier Markets 🧭: Niche Strength. Extreme strength isolated in Middle Eastern energy and drilling (Ades Holding).

From these screeners, we also produced a list of the 20 most dominant market themes.

Lester Davids

Senior Investment Analyst: Unum Capital