Despite a string of uninspiring jobs reports and persistent inflation, equities continue delivering the goods. On Monday, the first trading day after what was widely considered a dud of an August jobs report, the Nasdaq Composite Index notched another all-time high. Ongoing strength by the Nasdaq Composite and the Nasdaq-100 Index (NDX) confirms that market participants remain bullish on tech stocks.
That ongoing affinity could compel investors to branch out further into the tech ETF ecosystem and consider alternative approaches to market capitalization weighting. Enter the Invesco S&P 500 Equal Weight Technology ETF (RSPT ).
While not excessively allocated to tech titans such as Nvidia (NVDA) and Microsoft (MSFT), RSPT has performed admirably in 2025, delivering a gain of 13.25% since the start of the year. There are inklings of acceleration, too, as the equal-weight ETF is higher by 3.69% for the month ending September 8. RSPT’s recent bullishness could be an indication that market participants are almost certain the Federal Reserve will deliver interest rate cuts next week.
RSPT Could Be Rate-Cut Winner
Technology, the largest sector weight in the cap-weighted S&P 500, has a track record of being sensitive to Fed decisions. That could indicate a rate cut could be just what the doctor ordered to bring more investors into RSPT. It could also potentially send the equal-weight ETF higher.
“The Nasdaq’s record reflects more than enthusiasm for tech,” noted deVere Group CEO Nigel Green. “It’s a clear signal that markets believe the Fed must pivot. Weak jobs data has tipped the balance. Investors are betting on a cut, almost daring the Fed to keep pace.”
Odds indicate a 25-basis-point cut is what the Fed will deliver next week. While that may disappoint some market participants hoping for more aggressive monetary easing, that doesn’t mean the rate-cut case for RSPT is vulnerable. Should the Fed cut by 25 basis points next week, that leaves the door open for more cuts in the fourth quarter and into early 2026. The point is the prevailing wisdom is that the Fed’s benchmark borrowing rate will be significantly lower by the end of this year than it is today. That could benefit assets such as RSPT.
“Tech is at the forefront, but this rally is not just about chips and AI. It’s about liquidity and the conviction that cheaper borrowing costs are around the corner,” added Green.
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