INSTAT A European Asia–Asia-Pacific Markets Daily Pulse Report, February 13, 2026
Capital Rotation Intensifies: Cyclicals and Tech Leaders Surge as Defensives and Growth Laggards Unwind
Executive Summary
Today’s data reveals a pronounced rotational shift across European and Asia-Pacific markets, with capital flows favoring Cyclical Industrials, Defense, and Select Technology names while punishing Consumer Staples, Luxury Goods, and Overextended Growth stories. The 1D and 1W horizons show aggressive repositioning, often accelerating or reversing established 1M trends.
In Europe, a clear bifurcation has emerged: German industrials and defense names (Siemens Energy, Rheinmetall) lead with strong 1W momentum and perfect INSTAT scores, extending multi-week rallies. Conversely, French luxury (LVMH, Kering) and Dutch tech (ASML, Adyen) experience sharp defensive unwinds and short-term distribution, with deeply negative INSTAT readings accelerating weak 1M trends. The UK shows selective strength in defense and airlines (Rolls-Royce, BAE Systems) alongside deep weakness in consumer platforms (Auto Trader).
Asia-Pacific presents an even starker divide. Taiwan’s semiconductor leaders (TSMC, MediaTek) exhibit exceptional 1W and 1M strength with perfect INSTAT scores, signaling sustained institutional accumulation. Japanese capital goods (Komatsu) follow suit. However, India and China face broad-based selling across financials, tech, and consumer names (HDFC Bank, Infosys, Kweichow Moutai), extending multi-week downtrends. Australia experiences a violent defensive unwind in former high-momentum healthcare names (CSL, Cochlear).
Key anomalies for tagging include extended leaders with INSTAT ≥90 (Siemens Energy, TSMC, Rolls-Royce), deep laggards with INSTAT ≤-80 (Sanofi, Adyen, Cochlear, HDFC Bank), and potential contrarian watches where 1D/1W weakness conflicts with improving IN or positive 1M backdrops (Schneider Electric, Stellantis, WH Group, BHP Group).
Analysis of European In Country Capital Flows
Overview
The European session reveals a distinctly bifurcated landscape. Capital flows over the 1D and 1W periods favor Cyclical and Industrial names, particularly in Germany and the Nordics, while Consumer-facing and Defensive sectors in France and Switzerland exhibit significant short-term stress. The overall breadth is negative, but this is driven by deep underperformance in a concentrated group of laggards rather than broad-based selling. The 1M backdrop highlights the severity of the recent shifts; this week’s weakness in names like Kering and LVMH represents a sharp acceleration of a multi-week downtrend, while the strength in German industrials like Siemens Energy is extending an already powerful multi-week rally.
On a short-term basis, Switzerland and France are the clear laggards, posting negative mean 1W returns and deeply depressed INSTAT scores, signaling a defensive unwind and a rotation away from erstwhile market staples. Conversely, Germany and the UK are showing relative resilience, with pockets of strong 1W momentum. The Netherlands stands out as a story of violent divergence, where extreme weakness in former high-momentum tech names is dragging down the aggregate picture.
Bulleted Leader/Laggard Summary
Clear Leaders (Pro-Risk Cyclical Leadership): German industrials and defense names are leaders this week. Siemens Energy (ENR1n) shows a strong 1W extension, supported by a perfect INSTAT of 100. Rheinmetall (RHMG), despite a negative 1M, has bounced sharply this week, suggesting a short-term repair phase. Similarly, UK’s Rolls-Royce (RR.L) and BAE Systems (BAES.L) exhibit strong 1W momentum, capitalizing on the defense spending narrative.
Clear Laggards (Defensive Unwind/Luxury Stress): French luxury goods are experiencing a significant defensive unwind. LVMH (LVMH.PA) and Kering (PRTP.PA) have weak 1D and 1W performance, with deeply negative INSTAT scores, accelerating a poor 1M trend. Swiss defensives like Nestle (NESN.S) and Novartis (NOVN.S) are showing resilience, but the overall Swiss basket is dragged down by weakness in “bond-proxy” and defensive-growth names.
Clear Laggards (Short-Term Stress in Former Leaders): Dutch tech names are in a sharp short-term selloff. ASML (ASML.AS) and Adyen (ADYEN.AS) have posted deeply negative 1W returns and bearish INSTAT readings, representing a severe correction after a prolonged period of strength.
Bullet List of Key Anomalies to Tag in My Tables
Extended Leaders (Bullish Momentum):
Germany (Siemens Energy, ENR1n): Strongly Bullish, short-term extended. INSTAT 100 with exceptional 1W and 1M returns. Clear pro-risk leadership.
UK (Rolls-Royce, RR.L): Strongly Bullish. INSTAT 94 with strong 1W momentum, building on a strong 1M uptrend.
Spain (Iberdrola, IBE): Strongly Bullish. INSTAT 100 with strong 1D/1W flows, extending a solid 1M performance.
Deep Laggards (Short-Term Distribution):
France (Sanofi, SASY.PA): Strongly Bearish. INSTAT -100 with weak 1D and 1W performance; ongoing short-term distribution in a defensive name.
Netherlands (Adyen, ADYEN.AS): Strongly Bearish. INSTAT -100 with a catastrophic 1W drop, accelerating a weak 1M trend.
UK (Auto Trader, AUTOA.L): Strongly Bearish. INSTAT -100 with very weak 1D/1W performance, a sharp reversal from its prior uptrend.
Potential Contrarian Ideas:
France (Schneider Electric, SCHN.PA): Contrarian watch. While not negative, it’s a notable outperformer with an INSTAT of 75, showing a strong 1W/1M trend despite recent French market turbulence.
Italy (Stellantis, STLAM.PA): Contrarian watch. Negative 1M trend and 1D, but a very strong 1W bounce and positive IN suggests a potential short-term bottoming attempt.
Germany (SAP, SAPG): Contrarian watch. Negative 1D/1W and weak INSTAT (-75), but positive IN and a relatively stable 1M vs. the 1W drop, hinting at selling pressure that may not be sustainable.
Analysis of Asian In Country Capital Flows
Overview
The Asia-Pacific region presents a stark picture of selective, risk-on appetite heavily concentrated in specific markets and sectors, primarily Taiwan and select Japanese industrials, juxtaposed against deep, broad-based selling in India, China, and Australia. The short-term (1D, 1W) winners are clearly in technology and capital goods, while the losers span financials, consumer staples, and former high-growth names. The 1M context underscores the violence of these rotations; Australia’s 1W weakness is a sharp reversal of a strong 1M tape, while India’s continued decline represents an acceleration of a multi-week downtrend.
Japan is a microcosm of this divergence, with its capital goods exporters (Komatsu, Mitsubishi Heavy) showing strong 1W momentum, while its tech and financial names lag. The “Tiger Cubs” show isolated strength in the Philippines, but are otherwise mixed. The overall tone is not one of broad-based risk-off, but rather a violent sector and style rotation out of expensive growth and into cyclical value and specific structural winners.
Bulleted Leader/Laggard Summary
Clear Leaders (Tech & Industrial Leadership): Taiwanese semiconductors are the standout leaders. TSMC (2330.TW) and MediaTek (2454.TW) show exceptionally strong 1W and 1M returns with perfect INSTAT scores, indicating sustained institutional accumulation. Japanese cyclicals like Komatsu (6301.T) are also clear leaders, with a perfect INSTAT 100 on a strong 1W extension.
Clear Laggards (Broad-Based Distribution in India/China): Indian and Chinese markets are experiencing pervasive selling. Indian financials (HDFC Bank, HDBK.NS) and tech (Infosys, INFY.NS) are deep laggards with bearish INSTAT scores, extending a weak 1M trend. In China, consumer names like Kweichow Moutai (600519.SS) show weak 1W performance, reflecting persistent outflows from domestic growth stories.
Clear Laggards (Australian Selloff): Australia is a major laggard this week, driven by sharp selling in previously high-momentum names. CSL (CSL.AX) and Cochlear (COH.AX) have posted deeply negative 1W returns and bearish INSTAT scores, signaling a significant defensive unwind and de-risking.
Bullet List of Key Anomalies to Tag in My Tables
Extended Leaders (Bullish Momentum):
Taiwan (TSMC, 2330.TW): Strongly Bullish, short-term extended. INSTAT 100 with very strong 1W and 1M performance; clear leadership in global tech.
Japan (Komatsu, 6301.T): Strongly Bullish. INSTAT 100 on a powerful 1W and 1M rally, making new highs on strong flows.
South Korea (Samsung Electronics, 005930.KS): Strongly Bullish. INSTAT 92 with a very strong 1W move, breaking out after a positive 1M.
Deep Laggards (Short-Term Distribution):
India (HDFC Bank, HDBK.NS): Strongly Bearish. INSTAT -82 with weak 1D/1W performance, continuing its multi-week decline.
China (Shenzhen Mindray Bio-Medical Electronics, 300760.SZ): Strongly Bearish. INSTAT -100 on a weak 1D/1W, confirming a breakdown after a weak 1M.
Australia (Cochlear, COH.AX): Strongly Bearish. INSTAT -100 with a severe 1W selloff, a violent reversal of its long-term uptrend.
Potential Contrarian Ideas:
Hong Kong (WH Group, 0288.HK): Contrarian watch. Positive 1D/1W with an INSTAT of 100, a strong outlier against the weak Hong Kong tape.
South Korea (Kia Corp, 000270.KS): Contrarian watch. Very strong 1W and 1M performance with a high INSTAT (72), showing persistent buying despite some short-term choppiness in the broader market.
Australia (BHP Group, BHP.AX): Contrarian watch. Despite the massive selloff in Australian growth stocks, BHP shows a positive 1W and a relatively healthy INSTAT (32), suggesting capital is rotating into materials as a defensive/cyclical play.