US stock retail funds are flowing back into tech stocks; JPMorgan: Nvidia (NVDA.US) attracted $834 million last week, storage chip stocks are in favor

According to Smart Finance APP, the latest research report from JPMorgan shows that as the US stock market enters October, retail investor trading sentiment has begun to improve, with funds flowing back into the technology sector, especially artificial intelligence (AI), semiconductors, and storage chip-related stocks. Despite rising US Treasury yields, geopolitical risks, and oil price volatility that keep the market cautious, signs of a recovery in retail fund flows are emerging. Nvidia (NVDA.US) became the most favored stock among retail investors last week, with a net buy volume reaching $834 million. SanDisk (SNDK.US) and Micron Technology (MU.US) also ranked among the top buys.

JPMorgan pointed out that historically, retail investor trading activity tends to be most active in the first quarter of each year and relatively subdued in the third quarter. As September ends, the pressure of seasonal fund outflows appears to be easing. Recent retail fund inflows have rebounded from the September lows, with trading activity gradually recovering to near the average level of the past 12 months.

However, overall fund inflows remain slightly below historical averages. The report shows that for the week of October 1 to 7, US retail investors registered a net buy of $5.7 billion in stocks and ETFs combined, lower than the $6.7 billion per week average over the past 12 months. Of this, ETF net inflows were $4.7 billion, while individual stock net inflows were $1 billion, indicating that retail investors still prefer to participate in the market through ETFs.

Tech stocks have once again become the focus of retail capital chasing. JPMorgan data shows that the activity level of tech sector ETF inflows has risen to the 73rd percentile in historical distribution, compared to just the 4th percentile four weeks ago, reflecting a clear recovery in retail interest in the technology sector.

This round of fund inflows is not only concentrated among the "Magnificent Seven" of US stocks, but has also spread to other tech companies. The semiconductor and hardware sectors continue to attract funds, while software stocks have also seen a return to net buying, indicating that retail optimism across the technology sector is expanding.

Specifically, Nvidia received about $834 million in retail net buys last week, ranking first among all stocks. Alphabet—the parent company of Google (GOOGL.US)—ranked second with $265 million, SanDisk was third with $150 million, Micron Technology was fourth with $135 million, and Seagate Technology (STX.US) came in fifth with $129 million.

Other major tech stocks also saw fund inflows. Tesla (TSLA.US) recorded a net buy of about $122 million last week, Amazon (AMZN.US) $81 million, and Microsoft (MSFT.US) $34 million. In contrast, Apple (AAPL.US) saw an estimated net sell of about $15 million.

Notably, even though SpaceX (SPCX.US) shares rose about 15% last week, retail investors continued to reduce their holdings, with net sales reaching $177 million, making it the most sold-off stock of the week. JPMorgan noted that after its IPO, SpaceX attracted large retail holdings, and the recent price rally led some investors to take profits. However, since October, the pace of selling has slowed.

SpaceX has continued to draw market attention recently. In addition to progress on its Starship test flights and Starlink satellite deployments, market sources report that the company is seeking to raise about $40 billion to purchase Nvidia chips and expand its AI systems. Elon Musk previously indicated that the number of Nvidia chips used in Colossus 2 could double by the end of the year.

Besides SpaceX, Intel (INTC.US) saw a net retail sell of roughly $148 million last week, with Marvell Technology (MRVL.US), Super Micro Computer (SMCI.US), and Moderna (MRNA.US) also ranking among the top five stocks by net sell volume.

At the industry level, retail preference for tech stocks stands in sharp contrast to other sectors. In addition to about $602 million net inflow into technology and $143 million into industrials, most other major industries suffered net selling. For example, the communication services sector saw net outflows of about $231 million, the financial sector $184 million, and the healthcare sector $153 million.

Meanwhile, retail interest in financial stocks remains limited. JPMorgan pointed out that although major banks have underperformed recently, and with market expectations rising for Federal Reserve rate hikes, banks’ net interest income outlook has improved, and trading revenue may remain strong, retail investors have yet to actively buy into financial stocks at these lower levels.

As the Q3 earnings season approaches, corporate earnings performance may become the next key factor affecting retail fund flows. According to market consensus quoted in the JPMorgan report, Q3 corporate profits are expected to grow 31% year-on-year, or 27% excluding the energy sector; revenue is projected to grow 12% year-on-year, or 11% excluding energy.

The report notes that profit growth across industries is expected to improve compared to the same period last year, with the energy and tech sectors likely to lead, while consumer staples are expected to lag. However, full-year 2026 earnings estimates have continued to be revised down since early September, meaning the market must still watch closely to see if earnings can meet these elevated growth expectations.

JPMorgan believes that as the third-quarter earnings season nears, the return of retail funds to tech stocks, a recovery in ETF trading activity, and continued robust US economic growth all provide some support for market sentiment. Still, US Treasury yields, oil prices, and the geopolitical situation could impact investor risk appetite. Whether the technology sector can maintain its inflow trend will depend on the upcoming corporate earnings and changes in the macroeconomic environment.