Nasdaq beats record high set in 2000 during dot-com boom

Image source, AP

The tech-heavy Nasdaq index has closed at a record high, surpassing a level it last reached in 2000 at the height of the dot-com bubble.

The index gained 20.89 points to close at 5,056.06, besting the high of 5,048.62 it hit on 10 March 2000.

The S&P 500 index gained 4.97 to 2,112.93 and the Dow Jones rose 20.42 points to 18,058.69.

While the Dow Jones and S&P 500 have hit several records recently, the Nasdaq has taken longer to recover.

Some analysts think it can push on from the current level.

"[The Nasdaq] has the potential to go up, absent some external event that I can't predict," said Walter Price, senior portfolio manager at AllianzGI Global Technology fund.

'Different world'

However Mr Price said the current market environment is different from the dot-com boom of the late 1990s.

In 2000, "a lot of the high-growth companies were selling at 200 or 300 times next year's earnings," he said.

"This is nothing like that. This is a whole different world versus 2000."

The rise of Apple has been an important part of the Nasdaq's recovery. It launched the iPod in 2001 and the iPhone in 2007.

Image source, AP
Image caption,
The previous Nasdaq record was before the launch of Apple's iPod in 2001

The success of those products helped its market value surge to more than $750bn and accounts for around 10% of the index's value.

Back in 2000, Microsoft was the most valuable stock on the index, now it is a distant second to Apple with a value of $365bn.

Away from the Nasdaq, shares in IBM were the biggest winner on the Dow, rising over 3% after it reported better-than-expected earnings on Monday.

GM fell 3% despite a big profits jump.

GM reported first-quarter profits eight times higher than a year ago. It had no need to set aside money for recalls this year and the company said it made $945m.