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Feb. 22, 2020, 2:18 p.m. EST

Here are two charts that show the stock market isn’t anything like that of the dot-com mania

Distribution of big gainers isn’t comparable to 2000

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By Steve Goldstein, MarketWatch


Getty Images
The current market’s not actually like it was during the days of Bill Clinton in the White House.

The huge surge in stocks like Tesla /zigman2/quotes/203558040/composite TSLA -1.30%  , Virgin Galactic /zigman2/quotes/208333884/composite SPCE +7.00%   and Stamps.com /zigman2/quotes/202777086/composite STMP -1.35%   have brought back some trader memories of the heady days of the dot-com boom.

But Robert Buckland, a global strategist at Citi, studied stock market distributions to show the market now is not really that similar to that of the dot-com days.

He looked at the components of the MSCI World stock market index over 12 months and weighted returns by average market capitalization, both now and when the market peaked in 2000.

The current market is being led higher by the tech giants — Amazon /zigman2/quotes/210331248/composite AMZN -0.40%  , Facebook /zigman2/quotes/205064656/composite FB +1.52%  , Alphabet /zigman2/quotes/205453964/composite GOOG +0.54%  , Alibaba /zigman2/quotes/201948298/composite BABA -5.87%  , Microsoft /zigman2/quotes/207732364/composite MSFT +0.04%  and Apple /zigman2/quotes/202934861/composite AAPL +0.64%  .

But the dot-com era had many Tesla-like big performers. In March 2000, there were a number of companies that had tripled over 12 months.

The dot-com era also had a more extreme distribution of under-performers.

What’s his conclusion? It’s not a good one for those hoping for a rebound in value stocks.

“The message for beleaguered value investors is that things could get much worse before they get better,” Buckland writes.

“In the meantime, we are not especially surprised by Tesla-like moves in valuations. That is what happens towards the end of a growth bull market. In fact, it is a dangerous time to be a short-seller.”

/zigman2/quotes/203558040/composite
US : U.S.: Nasdaq
$ 816.88
-10.72 -1.30%
Volume: 9.99M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$151.43 billion
Rev. per Employee
$439,627
loading...
/zigman2/quotes/208333884/composite
US : U.S.: NYSE
$ 15.74
+1.03 +7.00%
Volume: 13.41M
May 22, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$3.31 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/202777086/composite
US : U.S.: Nasdaq
$ 189.04
-2.59 -1.35%
Volume: 165,055
May 22, 2020 4:00p
P/E Ratio
56.40
Dividend Yield
N/A
Market Cap
$3.23 billion
Rev. per Employee
$497,820
loading...
/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 2,436.88
-9.86 -0.40%
Volume: 2.87M
May 22, 2020 4:00p
P/E Ratio
116.41
Dividend Yield
N/A
Market Cap
$1215.46 billion
Rev. per Employee
$359,671
loading...
/zigman2/quotes/205064656/composite
US : U.S.: Nasdaq
$ 234.91
+3.52 +1.52%
Volume: 33.93M
May 22, 2020 4:00p
P/E Ratio
32.19
Dividend Yield
N/A
Market Cap
$669.39 billion
Rev. per Employee
$1.57M
loading...
/zigman2/quotes/205453964/composite
US : U.S.: Nasdaq
$ 1,410.42
+7.62 +0.54%
Volume: 1.31M
May 22, 2020 4:00p
P/E Ratio
28.46
Dividend Yield
N/A
Market Cap
$769.02 billion
Rev. per Employee
$1.39M
loading...
/zigman2/quotes/201948298/composite
US : U.S.: NYSE
$ 199.70
-12.46 -5.87%
Volume: 51.98M
May 22, 2020 4:00p
P/E Ratio
21.69
Dividend Yield
N/A
Market Cap
$535.74 billion
Rev. per Employee
$781,259
loading...
/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 183.51
+0.08 +0.04%
Volume: 20.83M
May 22, 2020 4:00p
P/E Ratio
30.56
Dividend Yield
1.11%
Market Cap
$1391.64 billion
Rev. per Employee
$902,473
loading...
/zigman2/quotes/202934861/composite
US : U.S.: Nasdaq
$ 318.89
+2.04 +0.64%
Volume: 20.45M
May 22, 2020 4:00p
P/E Ratio
25.00
Dividend Yield
1.03%
Market Cap
$1382.18 billion
Rev. per Employee
$1.98M
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Steve Goldstein is MarketWatch markets editor for Europe. Follow him on Twitter: @MKTWgoldstein.

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