• Tech funds are projected to attract a record $75 billion in inflows for 2025, according to Bank of America.
  • The sector saw a $4.4 billion inflow last week, extending a trend of robust demand despite valuation concerns.
  • The rally contrasts with crypto funds, which experienced $2.2 billion in outflows, pushing major cryptocurrencies to multi-month lows.

Investor appetite for technology stocks shows no signs of abating, with Bank of America projecting a historic $75 billion in inflows to tech funds for 2025. The forecast comes as the sector continues to draw capital, adding $4.4 billion just last week, even as the Nasdaq Composite Index retreated by roughly 2% after climbing 14% year-to-date.

This sustained demand underscores a powerful conviction in the long-term prospects of the tech sector, fueled by themes like artificial intelligence and digital infrastructure. "The momentum is structural, not speculative," said a portfolio manager at a large asset management firm, who asked not to be identified discussing client flows. "We're seeing allocations shift to capture what investors believe will be multi-year productivity gains."

While concerns about stretched valuations persist, the fundamental outlook for corporate earnings and the perceived pro-business policy environment following the recent election are bolstering confidence. Bank of America analysts noted in their weekly flow report that large-cap growth ETFs, which are heavily weighted toward tech, remain a favored play.

The tech rally stands in stark contrast to the mood in digital assets. Crypto investment funds bled $2.2 billion last week, with bitcoin and ether hitting multi-month lows amid the exodus. The divergence highlights a nuanced risk appetite, where investors are favoring tech's perceived tangible growth over more speculative digital assets.

In a parallel development, U.S. Treasuries saw a significant influx of $8.8 billion, their largest since April. This move suggests a portion of the market is simultaneously seeking safer havens, perhaps hedging against potential volatility in high-flying equity sectors. A spokesperson for Bank of America declined to comment beyond the published data.

Correction: An earlier version of this article misstated the timeframe for the Treasury inflow record. It was the largest since April.