The ongoing 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. As a result, the tech-heavy S&P 500 has experienced increased volatility and downside risks, contributing to its current decline. The market's focus on more stable investment options amid tech-driven volatility has further supported this rotation.
The MAX S&P 500 4X Leveraged ETN (SPYU) has experienced a significant drop, falling 6.53% to $49.21 as of 11:00 AM on Monday, January 27.