Warning: Technology stocks hit Dot-com bubble levels

Published: Saturday, May 24, 2025 at 7:57 am

**Tech Stocks Flash Warning Signs: Are We Headed for Another Dot-com Crash?**

The tech sector is sending out a stark warning signal, with valuations mirroring those seen during the peak of the 2000 Dot-com bubble, raising concerns about a potential market crash. According to recent analysis, the Nasdaq 100 Index, a key benchmark for technology stocks, has reached a valuation level relative to the M2 money supply that hasn't been seen since the dot-com boom. This metric, which considers the growth in the money supply, suggests that current market valuations are not solely driven by stock price increases.

The last time the tech sector hit these levels, the bubble burst, leading to a prolonged bear market and significant losses for investors. The current situation is particularly concerning given the recent meteoric rise of technology companies, fueled by advancements in artificial intelligence (AI) and the semiconductor industry. Companies like Palantir have experienced substantial revenue and stock price growth, but analysts are expressing caution about potential overvaluation.

Adding to the uncertainty, renewed trade tensions could further destabilize the market. President Donald Trump's warnings of potential tariffs on the European Union and imported iPhones have already rattled investors. Apple's stock, for example, saw a 3% drop following these announcements.

The volatility in tech stocks throughout 2025, coupled with the sector's return to Dot-com era valuation levels, suggests that the risk of a market correction is significantly elevated. Investors are advised to proceed with caution and closely monitor market developments.

Keywords: tech stocks, Nasdaq 100, Dot-com bubble, market crash, valuation, M2 money supply, AI, semiconductors, Palantir, Apple, trade tensions, tariffs, stock market, investment, bear market, market correction

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