The Day the NASDAQ Hit 5,048: Peak of the Dot-Com Bubble

On Friday, March 10, 2000, the closing bell rang on Wall Street and the NASDAQ Composite stood at 5,048.62 — the highest close in its history. It had gained just 1.78 points on the day, but the number on the screen said everything: in less than six months the tech-heavy index had surged nearly 88 percent. The future had arrived, and it ended in ".com."

The mania had been building for years. The World Wide Web, born in the early 1990s, had turned the internet from a research tool into a gold rush. Investors poured money into any startup with a website and a dream, convinced that the old rules of business — profits, for instance — no longer applied. In 1999 alone the NASDAQ rose 86 percent. Companies that had never earned a dollar were worth billions. Even Federal Reserve Chairman Alan Greenspan, who had once warned of "irrational exuberance," sounded swept up, quoting chief executives who called it "a true revolution."

March 10 was the top, though nobody rang a bell. Three days later, news that Japan had slipped back into recession triggered a global sell-off that hit technology stocks hardest. On March 20, Barron's ran a cover story titled "Burning Up," warning that internet companies were running out of cash fast. That same day, the software company MicroStrategy restated its revenues and lost 62 percent of its value in a single session. The air was coming out.

What followed was one of the great wipeouts in market history. By the time the NASDAQ bottomed on October 10, 2002, at 1,108.49, it had lost more than three-quarters of its value. Pets.com, Webvan, and hundreds of other dot-coms vanished entirely, taking billions in invested savings with them. The index would not close above its March 2000 peak again until April 23, 2015 — fifteen years later.

Bubbles are easy to spot in hindsight and nearly impossible to resist in the moment. The dot-com crash taught a generation of investors the difference between a revolutionary technology and a good investment — the internet really did change everything, just not on the schedule or at the prices of March 2000. Every market mania since has been measured against those five digits on a spring Friday: 5,048.62.

Photo: NASA, public domain (via Wikimedia Commons). The photograph shows the Nasdaq MarketSite tower screen in Times Square, New York, displaying a NASA message in 2021.