March 2000 vs. June 2024: How Different Is It?
The Wall Street Journal (WSJ) ran a post on June 22 that compared AI-enabler Nvidia (NASDAQ:NVDA) to Cisco (NASDAQ:CSCO) at the top of the dot.com bubble in early 2000. At the time, CSCO traded for ~130x forward earnings compared to “only” 45x for NVDA, though NVDA’s impact on the market-cap weighted S&P 500 is staggering at 7% of the index today.
The magnificent seven, which includes NVDA and six other mega-cap tech stocks, account for ~25% of the S&P 500 and the bulk of the index’s return over the past several years. For example, the S&P 500 gained 24% in 2023 and 15% year-to-date through June 21 compared to 12% and 5%, respectively, for the equally weighted S&P 500 (NYSE:RSP). ...
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