HOW LOW WILL TECH STOCKS GO?

HOW far can tech stocks fall? If previous experience is any guide, then the answer may be an awful lot further than you might think.

The Nasdaq composite index peaked at 5.056 on March 24 2000 as the internet mania reached its crescendo.

It was downhill all the way from there and by the time it had bottomed out two-and-a-half years later the Nasdaq had dropped under 1,200 — a fall of more than 75pc.

It then began its long, slow recovery.

The Nasdaq didn’t surpass its March 2000 high until July 2015. While the morethan 15 years which it took the Nasdaq to return to its previous high didn’t match the 25 years it took the Dow to reattain its pre-crash levels of 1929, it comes pretty close.

Today’s Nasdaq bears only a scant resemblance to its 2000 counterpart.

Of the 10 most valuable companies included in the index at the turn of the century, only three — Microsoft, Cisco and Intel — are still in situ today.

Indeed, several of today’s top 10 including Alphabet (the parent company of Google) and Facebook weren’t even on the Nasdaq in 2000 — Facebook was only founded in 2004.

So if history is about to repeat itself, the Nasdaq that regains its March 2018 peak some time in the early to mid-2030s could be a very different collection of companies than today’s version.