{"id":56552,"date":"2025-08-10T07:08:23","date_gmt":"2025-08-10T07:08:23","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/56552\/"},"modified":"2025-08-10T07:08:23","modified_gmt":"2025-08-10T07:08:23","slug":"stock-market-bubble-chart-shows-overvaluation-higher-than-dot-com-boom","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/56552\/","title":{"rendered":"Stock Market Bubble: Chart Shows Overvaluation Higher Than Dot-Com Boom"},"content":{"rendered":"

The stock market may be in a bubble that rivals the one seen during the dot-com boom<\/a>.<\/p>\n

That’s according to Torsten Sl\u00f8k, the chief economist of Apollo Global Management, who said on Wednesday that the top firms in the S&P 500<\/a> are “more overvalued” than the top companies during the peak of the internet stock<\/a> craze in the late 1990s and early 2000s<\/p>\n

The top 10 names in the benchmark index are trading at a 12-month forward price-to-earnings ratio of around 25, according to Sl\u00f8k’s analysis. That suggests companies are priced at a slightly higher premium than they were two decades ago, he wrote in a note on Wednesday.<\/p>\n

\"Chart<\/p>\n

The valuation of the top 10 companies in the S&P 500<\/p>\n

Bloomberg\/Apollo Chief Economist<\/p>\n

“The difference between the IT bubble in the 1990s and the AI bubble today is that the top 10 companies in the S&P 500 today are more overvalued than they were in the 1990s,” Slok wrote.<\/p>\n

Talk of a bubble<\/a> has been on the rise for years on Wall Street, ever since the debut of ChatGPT at the end of 2022 set off a frenzy for AI in the stock market. <\/p>\n

The market has all the ingredients for a stock bubble, with the exception of a more dovish Federal Reserve, strategists at UBS wrote in a note last week. Once the central bank resumes cutting rates, the conditions for a bubble should all be present, the bank said.<\/p>\n

“We up the probability of a Bubble scenario to 25% for end-2026 and acknowledge a risk that this is too low,” the strategists wrote.<\/p>\n

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In early July, Citi said it believed stocks would continue to outperform, thanks to an AI bubble<\/a> forming in equities.<\/p>\n

“Our hunch would be a possible bubble in AI related stocks may well only peak around half a year before the capex spent in USD peaks,” analysts wrote, referring to capital expenditures<\/a> related to AI.<\/p>\n

In June, market veteran Ed Yardeni said he believed the market could be entering “melt-up<\/a>\u00a0mode,” a state in which stocks see a rapid rise that proves to be ultimately unsustainable. <\/p>\n

“It’s a bit hard to believe, but the main risk at this time may be a stock market meltup, i.e., a speculative bubble,” he wrote, pointing to the S&P 500 notching a fresh record<\/a> that month.<\/p>\n","protected":false},"excerpt":{"rendered":"The stock market may be in a bubble that rivals the one seen during the dot-com boom. That’s…\n","protected":false},"author":2,"featured_media":56553,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[554,30834,30831,84,6267,30833,30836,467,30835,12716,3350,4767,30388,5597,30832,56,54,55,5952,1942],"class_list":["post-56552","post","type-post","status-publish","format-standard","has-post-thumbnail","category-markets","tag-ai","tag-ai-bubble-today","tag-big-bubble","tag-business","tag-central-bank","tag-dot-com-boom","tag-late-1990","tag-markets","tag-peak","tag-rise","tag-sp","tag-stock-market","tag-stock-market-bubble","tag-strategist","tag-top-company","tag-uk","tag-united-kingdom","tag-unitedkingdom","tag-wednesday","tag-year"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/56552","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=56552"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/56552\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/56553"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=56552"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=56552"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=56552"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}