WhyItDropped

Nasdaq · May 30, 2000

Betting the hikes were over

+7.94%

single-day change vs previous close

Part of a longer stretch

The summer that still believed

early in it · 2000-05-23 → 2000-07-17, +35.08% over the whole period

What happened that day?

  • On 30 May 2000 the Nasdaq rose 7.94% in a single day
  • It was a bounce inside the decline that had run for over two months from the March peak
  • Economic data showed signs of slowing, and hope grew that the Fed would stop raising rates
  • Since rate rises had been one of the triggers of the bust, the logic was that stopping them changed things
  • The Fed did in fact stop after May that year. The bet was correct
  • The Nasdaq kept falling anyway. A bubble deflating runs on its own schedule

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.