NASDAQ (and technology stocks in general), are like a finely tuned sports car. They can run circles around your grandmother’s Oldsmobile (the Dow), but they tend to break down often, requiring TLC at a repair shop.
Since its founding, and since 2015, NASDAQ has outpaced the Dow and S&P 500, but it’s a story of the hare and tortoise, with this rascally rabbit taking long naps from time to time – eventually winning the race, if you can stomach the volatility which often accompanies the risks inherent in technology stocks.
This brings us to the current market rotation. Since November 1, 2025, the Dow is up 4.34% while NASDAQ is down 3.54%, in a mirror image of each other, as we’ve seen yet another rotation out of red-hot technology stocks (your favorite sports car) and back into the reliability of grandma’s Oldsmobile sedan.
Consumer Discretionary stocks tanked due to a Tariff Tantrum in April. These stocks went down at first but are well up now. We seldom go wrong trusting the U.S. consumer, especially when sentiment turns temporarily down.
Consumer Discretionary outpaced essential purchases (Staples) in the last year, but they rotated recently:
Yes, NASDAQ can break your heart, but give her another chance. Here’s what your reward can look like:
In late 2021, when officials were still telling us was “transitory” and nothing to worry about, shoppers and sensible folk knew better, as some big institutions started taking profits on their winners.
On November 19, 2021, NASDAQ hit an all-time high of 16,057 and then fell sharply, down 36.4% by the end of the next year, closing December 28, 2022, at just 10,213. In those same 13+ months, the other two major indexes fell some, but far less: The S&P was down about 19%, while the Dow lost only 7.65%.
Those NASDAQ scars may have healed by now, but if you owned a fleet of high-performance speedsters in 2022, you were likely badly hurt. Those scars healed because 2023 reversed those losses in short order:
In three years, 2023-25, NASDAQ shot up 122%, while the S&P rose 78% and the Dow eked out just 45%.
The Biggest NASDAQ Disaster – The Y2K Crash
Back in 1999, NASDAQ was soaring, doubling from June 1999 to March 2000, while the Dow looked like Rip Van Winkle, sleeping soundly. This all changed in March 2000, when the Dow actually rose while the NASDAQ lost 50% or more in short order. During February 2000, NASDAQ “melted up” while the Dow was down, but in mid-April NASDAQ melted down while the Dow was actually rising in NASDAQ’s worst week.
While NASDAQ rose 122% in from the start of 1999 to the end of February 2020, the S&P and Dow rose 16% and 17%, respectively. Then, their fates reversed. From March to May, the blue-chip indexes rose 4%, while the NASDAQ fell 28%. In one week – April 11-15 – NASDAQ fell 25.3% while the Dow rose 3.4%.
Worse yet, it took 16 years for NASDAQ to regain its mojo – its March 2000 peak – while the Dow and S&P 500 briefly set new-highs by 2007 and then set new all-time highs for keeps by 2012. After 16 years, the Dow was flying high, up 48.6%, vs. 33.8% for the S&P 500, versus a slight decline for the NASDAQ.
And, speaking of Y2K, pay no attention to those gloomy chartists who compare 2026 to 2020. The dot-com boom in 1999 was led by dreamy internet applications with no earnings, while today’s technology leaders have phenomenal sales and earnings, with strong future guidance for real-life business applications, so don’t give up on this super-charged corner of Wall Street. Over time – since its launch 55-years ago – NASDAQ has run rings around the Dow – by between 2:1 and 4:1 and outpaced the S&P 500 as well.
NASDAQ is up nearly 260-fold since its founding, rising from 89.61 at the start of 1971 to 23,242 at the start of 2026. In the same 55 years, the Dow is up just 57-fold, and the S&P 500 is up by 74-fold.
Have faith, NASDAQ investors. Not all those four-letter stock symbols deserve your four-letter curses.