The information technology sector has clawed its way back to dot-com era returns — and then some. Since the bubble burst in 2000, the sector has posted a 9% annualized growth rate, matching the returns of the boom years. Now, tech stocks account for 37% of the S&P 500, a share that tops the previous peak reached during the dot-com mania.
Matching Dot-Com Returns
The 9% annualized figure covers more than two decades of recovery and expansion. That growth rate is identical to the one the sector delivered during the dot-com bubble, when investors poured money into internet startups, many of which later collapsed. The current run has been steadier — no crash followed by a long hangover — but the end result is the same: tech has been the market's best-performing corner since the turn of the century.
A New Peak in S&P 500 Weighting
Tech's 37% weighting in the S&P 500 is a record. It surpasses the dot-com era peak, when the sector briefly commanded about a third of the index before the bubble burst. The current concentration means that the fortunes of the entire benchmark are increasingly tied to a handful of companies — Apple, Microsoft, Nvidia, and others. That's a shift that has drawn attention from regulators and investors alike, though the facts alone don't indicate any immediate action.
The sector's share has grown steadily over the past decade, driven by the rise of cloud computing, artificial intelligence, and digital services. The 9% annualized return since 2000 matches the dot-com era's growth, but the current 37% weighting is a new high — one that underscores tech's dominance in the modern economy.
