Invesco QQQ Sees Major Stake Cut Amid Shifting Tech Fortunes

NEW YORK (Azat TV) – The Invesco QQQ Trust (QQQ), a popular exchange-traded fund tracking the tech-heavy Nasdaq-100 Index, is currently navigating a period of significant market pressure and divided institutional investor sentiment. In a notable move, SouthState Bank Corp dramatically cut its investment in QQQ during the third quarter, reducing its position by 44.6 percent. This divestment, involving the sale of 6,263 shares and retaining just 7,786 shares valued at approximately $4.67 million, highlights a growing caution among some financial institutions regarding the ETF’s near-term prospects amid a broader tech market downturn and shifting investor preferences.

Institutional Investors and QQQ Exposure

SouthState Bank’s decision to trim its Invesco QQQ holdings comes as the fund faces mounting pressures, including a Nasdaq selloff, technical breakdown risks, and a rotation of investor sentiment toward safer assets. However, this move contrasts sharply with the actions of several other major institutional investors who significantly increased their exposure to QQQ during the same period.

JPMorgan Chase, for instance, boosted its holdings by 42.4 percent in the second quarter, bringing its total position to nearly 4.9 million shares valued at approximately $2.7 billion. HRT Financial expanded its stake by an impressive 118.3 percent, now holding over 3.1 million shares worth roughly $1.74 billion. Kensington Asset Management showed even more aggressive growth, increasing its position by 2,124.5 percent to 366,881 shares, valued at about $202.4 million. Additionally, Symphony Financial acquired a new position exceeding $1.23 billion, and 1832 Asset Management doubled its holdings. These divergent strategies among professional money managers underscore the complex and uncertain outlook for the tech-focused ETF.

Despite these mixed signals, institutional investors collectively own 44.58 percent of QQQ’s outstanding shares, indicating its continued popularity among sophisticated market participants seeking concentrated exposure to leading technology and growth companies.

Broader Market Headwinds for QQQ

The Invesco QQQ ETF, which opened at $605.75 on Thursday, February 5, 2026, has experienced recent weakness. Its 50-day moving average stands at $620.23, while its 200-day moving average sits at $601.72, suggesting a decline from earlier highs. On the same day, QQQ dropped by over 2.27 percent, mirroring a broader market downturn that saw the SPDR S&P 500 ETF (SPY) fall by 0.55 percent and the Nasdaq Composite decline by 0.51 percent.

Technical analysts have issued warnings that the Nasdaq-100 Index is approaching a significant breakdown level, which could trigger further selling pressure and accelerate outflows from the ETF. The fund’s concentration in mega-cap technology names makes it particularly vulnerable to market downturns and shifts in sentiment. Reports suggest a broader investor rotation away from growth stocks and artificial intelligence-focused holdings in favor of more defensive positions, a trend that typically pressures funds like QQQ that emphasize high-growth assets. Concerns over Federal Reserve policy direction are also contributing to uncertainty around technology sector valuations.

QQQ Performance and Contrasting Market Trends

While the Invesco QQQ ETF faces headwinds, other investment vehicles are thriving. The Schwab US Dividend Equity ETF (SCHD), for example, has jumped by over 12 percent this year, reaching an all-time high. SCHD’s success is largely attributed to its minimal exposure to the technology industry, which accounts for only about 8 percent of its fund. Instead, its portfolio is heavily weighted towards energy, consumer staples, healthcare, industrials, and financials—sectors that often perform well during periods of rising risk and economic uncertainty.

Many growth stocks that previously drove the equities market have slumped. Microsoft’s stock price plunged to $400 from its all-time high of $565, and NVIDIA has entered a bear market, falling over 20 percent from its November peak. Software companies like Atlassian, ServiceNow, Intuit, and Salesforce have seen even steeper declines, plunging over 60 percent from their all-time highs. This underscores the current market preference for cheaper, value-oriented stocks with higher dividends, like those found in SCHD, over highly valued tech names such as Palantir and Tesla.

Despite these challenges, Invesco QQQ recently increased its quarterly dividend payment to $0.7941 per share, up from the previous $0.69 distribution, representing an annualized dividend of $3.18 and a yield of approximately 0.5 percent.

Economic Indicators and Tech Sector Outlook

The current market volatility affecting funds like QQQ is compounded by broader economic concerns. U.S.-based employers announced 108,435 job cuts in January, marking the highest level since January 2009. Additionally, U.S. jobless claims rose to 231,000 for the week ended January 31, 2026, exceeding Wall Street’s expectations of 212,000 claims. These figures suggest a softening labor market that could further influence investor behavior.

Adding to the tech sector’s challenges, Alphabet announced on Wednesday, February 4, 2026, that it expects capital expenditure to reach between $175 billion and $185 billion this year, more than double its 2025 spend. While Alphabet CEO Sundar Pichai stated these investments in AI computing capacity are driving revenue and growth, the significant increase in spending spooked some investors, contributing to the negative sentiment surrounding tech stocks.

The mixed signals from institutional investors and the contrasting performance of growth-focused QQQ versus dividend-oriented SCHD highlight a market in transition, where short-term economic uncertainties and shifting investor priorities are creating a complex environment for even established exchange-traded funds.