(Reuters) - The Nasdaq Composite, the U.S. market index most closely associated with technology stocks, closed at an all-time high on Thursday, surpassing a 2000 record set just before the dotcom crash.
Its new record close of 5,056.06 capped a slow, unsteady climb since it touched a 2002 low of 1,114.11, that spanned an economic recession, the rise of biotech and social media and the explosive growth of mobile phones that has helped make Apple Inc (AAPL.O) the most valuable company in the United States.
The Nasdaq traded as high as 5,073.091 on Thursday, led by shares of Apple, which has been among the biggest positive influences on the index in recent years. The index’s last record close of 5,048.62 was hit on March 10, 2000.
The benchmark S&P 500 index .SPX also set an intraday high, but closed shy of a new record.
Rapid growth in biotechnology companies such as Gilead Sciences Inc (GILD.O) and social media firms like Facebook Inc (FB.O), driven by the popularity of mobile computing, also helped lift the Nasdaq to its current levels.
Strategists say there is still room for the Nasdaq to rise.
“Now that it’s making a new high, I don’t think it’s just going to stop. It has the potential to go up, absent some external event that I can’t predict. I think the companies look as though they ought to power through this environment,” said Walter Price, senior portfolio manager and managing director of the AllianzGI Global Technology fund in San Francisco.
In 2000, “a lot of the high-growth companies were selling at 200 or 300 times next year’s earnings. This is nothing like that. This is a whole different world versus 2000.”
On Thursday, shares of Gilead were up 1 percent at $105.21, while Facebook, which late Wednesday posted quarterly revenue that missed analysts estimates, was down 2.6 percent at $82.41.
Shares of Apple were up 0.8 percent at $129.67, while Google Inc (GOOGL.O) was up 1.5 percent at $557.46. They are the two top components by market cap in the Nasdaq. Microsoft Corp (MSFT.O), which was the top component in March 2000, is now third, followed by Facebook.
The Dow Jones industrial average .DJI rose 20.42 points, or 0.11 percent, to end at 18,058.69, the S&P 500 gained 4.97 points, or 0.24 percent, to 2,112.93 and the Nasdaq Composite added 20.89 points, or 0.41 percent, to 5,056.06.
After the close, Nasdaq 100 e-mini futures NQc1 jumped as Google, Microsoft and Amazon.com (AMZN.O) reported results. Google shares were up 3.7 percent after the bell, while Microsoft was up 3.1 percent and Amazon was up 7.4 percent.
The Nasdaq shed 78.4 percent of its value from the 2000 peak to its 2002 low 31 months later. From the March 2009 trough to today’s record, the index gained 300 percent.
The Nasdaq Composite’s market capitalization is $8.2 trillion, compared with a $19.5 trillion market cap for the S&P 500, according to Thomson Reuters data. The Nasdaq’s market cap was at $6.6 trillion in March 2000.
“It shows the strength in technology and biotechnology and the M&A going on in both those areas, but especially in biotech,” said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
Though the Nasdaq is heavily associated with technology, the S&P 500 technology sector .SPLRCT is actually down about 21 percent since March 10, 2000, according to S&P-Dow Jones Indices analyst Howard Silverblatt.
On Thursday, eight of the 10 major S&P sectors were higher.
Advancing issues outnumbered declining ones on the NYSE by 2,039 to 956, for a 2.13-to-1 ratio on the upside; on the Nasdaq, 1,659 issues rose and 1,061 fell, for a 1.56-to-1 ratio favoring advancers.
About 6.6 billion shares changed hands on U.S. exchanges, compared with the daily average of 6.2 billion for the month to date, according to data from BATS Global Markets.
Additional reporting by Chuck Mikolajczak, Sinead Carew and Rodrigo Campos; Editing by Savio D'Souza, G Crosse and Nick Zieminski