The technology-stock bubble that burst after the Nasdaq peaked in March 2000 was the dot-com bubble. It was a period of intense speculation in internet-related companies during the late 1990s and early 2000s.
The Nasdaq Composite reached an intraday high of 5,132.52 on March 10, 2000. Investors often valued companies according to website traffic, projected growth, or brand recognition rather than current profits. Many newly listed businesses had little revenue and no sustainable earnings.
After the peak, technology shares fell rapidly. The Nasdaq Composite lost about 78% of its value by October 2002. Numerous internet companies failed, while established firms with strong finances eventually survived and helped build the modern digital economy.
The dot-com bubble is sometimes confused with the broader early-2000s recession. The recession had several causes, but the collapse in technology valuations was a major financial shock that preceded it.