A new report from Betashares has provided a snapshot of what is set to be a record-breaking year for ASX ETFs.
According to the report, the Australian ETF industry closed the financial year at a record $372 billion in funds under management, with $400 billion now firmly in sight.
Net flows of $30 billion for the half matched the entirety of 2024, while AI-driven tech exposures led performance.
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Market insights
According to the report, global equity markets rallied through the first half of 2026, powered by evidence that AI capital expenditure is starting to convert into profit.
Microsoft, OpenAI, and Anthropic all reported AI revenue run rates up more than 100% year on year, while Nvidia and the major memory makers, Samsung, SK Hynix, and Micron, were the clearest beneficiaries of the compute build-out.
Asian semiconductor markets captured this directly, with North Asian chipmakers driving the MSCI Emerging Markets Index to the strongest returns of any major market, even as an Iran-triggered oil spike and a US$1.5 trillion software sell-off tested the rally's nerve during the half.
Domestically, the S&P/ASX 200 Index (ASX: XJO) managed just 2.4% over the same six months, the weakest of the major developed markets.
Three RBA rate hikes in the half pushed inflation and unemployment back into focus, rewarding income and value over growth.
Materials carried the bulk of the market's earnings growth, benefiting from elevated iron ore and gold prices and from critical mineral demand driven by the AI rollout.
The May budget's proposed removal of the CGT discount added further uncertainty for households already absorbing higher borrowing costs, and the combination has weighed on consumer sentiment through the half.
Performance – Half Year 2026
The Betashares Australian ETF Review revealed that the half-year performance was led by semiconductors, with AI-related hardware demand driving standout returns over the period.
South Korea's technology-heavy market also featured prominently, alongside broader Asian technology exposure, reinforcing a theme of innovation-driven outperformance.
Hydrogen and clean energy themes made a strong showing, pointing to renewed appetite for energy transition plays.
Crude oil rounded out the top five, with prices driven sharply higher by the Middle East conflict and resulting disruptions to the Strait of Hormuz, a key global oil transit route.
Top 5 performing funds for the half year to June 2026:
- Global X Semiconductor ETF (ASX: SEMI) rose almost 102%
- iShares MSCI South Korea ETF (ASX: IKO) climbed 94%
- Global X Hydrogen ETF (ASX: HGEN) rose 70%
- Betashares Capital – Asia Technology Tigers ETF (ASX: ASIA) increased by 59%
- BetaShares Crude Oil Index ETF – Currency Hedged (Synthetic) (ASX: OOO) rose over 44%
