Dot-Com Bust
2000-style tech bubble unwind: profitless growth stocks fall for years while boring cash-flow businesses hold up far better.
Dated events
- · Nasdaq closes at record 5,048.62, the peak of the dot-com bubble
The Nasdaq index hit its all-time high as internet and technology companies with no profits reached their most expensive valuations. Investors had been buying these companies based on hopes for future growth rather than actual earnings, and this peak marked the moment before those hopes began to crack. - · Nasdaq falls 9.7% in its biggest one-day drop, ending a week down 25%
Internet and technology shares that had soared in price fell sharply after a higher-than-expected inflation report raised fears of further interest rate rises. Investors were also growing doubtful that many of these companies would ever become profitable, and people who owned the stocks rushed to sell before prices fell further, which caused prices to fall even more. - · Nasdaq closes below 2,000 for first time since 1998, 62% below its peak
Technology stocks had collapsed to a fraction of their peak value as the reality set in that many internet companies would fail entirely. Companies that had never made money and had burned through their cash reserves began going out of business, confirming investors' worst fears. - · Nasdaq closes at 1,114.11, its dot-com bear market low (down 78%)
Technology stocks finally stopped falling after more than two years of decline, having lost roughly 80 percent of their value from the peak. By this point, the weakest companies had already disappeared, and investors began to see value in the survivors and in profitable older businesses that had held up much better.
Assets named in this scenario · 5
Apple Inc.Invesco QQQ Trust (Nasdaq-100)iShares 20+ Year Treasury Bond ETFMicrosoftSPDR S&P 500 ETF Trust
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Matched keywords: tech bubble, dotcom crash, tech selloff, growth stock crash, teknoloji balonu, teknoloji çöküşü
