Tech stocks on track for record annual inflows as investors pile into the AI trade

If investors are getting nervous about how fast tech stocks have risen this year, they aren't really showing it.

Tech stocks are on track for their largest annual inflows in history, according to new data from Bank of America (see the chart below). At the current pace, that would constitute about $152 billion in annual inflows.

Why it matters: Strong inflows into tech names reflect an upbeat backdrop for this important part of the market.

The Nasdaq Composite (^IXIC) delivered a blockbuster performance in the second quarter of 2026, surging 21.4% to post its best quarterly run since the post-pandemic rebound of 2020.

The explosive growth was primarily fueled by an unrelenting investment boom in artificial intelligence infrastructure. That propelled semiconductor hardware heavyweights such as AMD (AMD) and memory suppliers like Micron (MU) to record highs.

Momentum in tech was further amplified by the mid-June IPO of Elon Musk's SpaceX (SPCX).

The tech-heavy index did experience a minor 2.8% pullback in June as investors briefly rotated capital into small caps and worried about Big Tech's AI capital expenditures. But the trade has stabilized in early July, and the Nasdaq Composite is above the lows seen in June.

The bottom line: Inflows into tech will likely remain strong heading into year-end, based solely on the group's profit outlook. 

S&P 500 (^GSPC) forward earnings estimates have been revised higher by 18% since the beginning of the year, Truist chief market strategist Keith Lerner pointed out. This is the strongest year for earnings since at least 2000, led by the tech sector.

Brian Sozzi is Yahoo Finance's Executive Editor, host of the 'Power Players With Brian Sozzi' podcast and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.

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