NASDAQ suffered a major crash during the collapse of the dot-com bubble in 2000.
The technology-heavy NASDAQ Composite reached an intraday peak of 5,132.52 on March 10, 2000. Investors had poured money into internet and technology companies, often valuing firms more on expected future growth than on current profits. When confidence weakened, high-priced shares fell sharply and the downturn spread across the sector.
The NASDAQ Composite declined about 78% from its 2000 peak to its October 2002 low. Many internet companies failed, while others survived by developing sustainable revenue models. The crash therefore reshaped the technology industry rather than ending innovation in internet businesses.
NASDAQ is both a U.S. stock exchange and the name commonly used for its major composite index. The exchange was founded in 1971 as an electronic quotation system. The dot-com collapse is distinct from the broader 2008 financial crisis, although both affected investors worldwide.