The recent tech selloff, spurred by concerns over capital spending in AI, has led to a notable rotation into value stocks, which has benefited the equal-weighted S&P 500. This shift has been driven by the index's diversified sector exposure, particularly in industrials, utilities, and financials, allowing it to outperform its market-cap-weighted counterpart. The tech-heavy indices have faced increased volatility and downside risks, prompting investors to seek more stable investment options. As a result, the equal-weighted S&P 500 has gained favor among strategists, who recommend it as a strategic investment aligned with long-term policies and offering relatively low valuations.
The SPDR Portfolio S&P 500 Growth ETF (SPYG) experienced a decline, dropping 3.22% to $89.06 by 11:00 AM on Monday, January 27.