# S&P 500 Valuations Near Dot-Com Levels as Nasdaq Stays in Correction

By Enna Lee

Canonical URL: https://www.tokenpost.com/news/investing/30065
Published: 2026-10-12T05:59:56.000Z
Updated: 2026-10-12T05:59:56.000Z
Section: Investing

> The Shiller CAPE ratio has climbed above 40, while the Nasdaq Composite is down 10.6% from its peak and the S&P 500 has fallen 7.1%.

The S&P 500’s Shiller CAPE ratio has climbed above 40, approaching its dot-com-era peak, while the Nasdaq Composite remains in correction territory after a 10.6% decline from its record high.

The CAPE ratio uses 10 years of inflation-adjusted earnings to measure valuation. It reached roughly 44 during the dot-com era, before the S&P 500 fell nearly 40% and the Nasdaq dropped nearly 80% over about three years.

Market breadth has also weakened. More stocks have recently reached 52-week lows than highs, including on days when major indexes advanced. The pattern last occurred shortly before the dot-com bubble burst.

The S&P 500 is down 7.1% from its peak, while the Dow Jones Industrial Average has declined 8.4%. The Nasdaq first closed in correction territory March 26, falling from 23,958 to 21,408 as tariff concerns and higher oil prices pressured markets.

Oil later reached a multiyear high after the U.S.-Iran war sent prices higher. Moody’s chief economist Mark Zandi said a sustained Middle East conflict could push the U.S. economy into recession.

Federal Reserve Chair Jerome Powell said in September 2025 that equity prices were “fairly highly valued” by many measures. The Bank of England later said the risk of a sharp market correction had increased.

International Monetary Fund Managing Director Kristalina Georgieva said in October 2025 that a sharp correction and tighter financial conditions could weigh on global growth.

The Nasdaq has fallen at least 10% from a record 12 times since 2011. It gained an average of 22% during the following 12 months in those cases, rising in 11 of the 12 periods.

The S&P 500’s valuation and oil prices are key figures to watch as markets remain under pressure.