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Dot-com deja vu: Nasdaq closes in on its record high

NEW YORK (AP) — The last time the Nasdaq was this high, Bill Clinton was president, Microsoft dominated the tech world and the iPod, iPhone and iPad didn't exist.
Fifteen years later the Nasdaq is again near 5,000 and close to topping its record from the dot-com boom. The index has clawed back, riding a six-year bull market, and is less than 100 points from its all-time high of 5,048.62 reached March 10, 2000.
But this isn't the Nasdaq of Pets.com and Webvan, when companies were valued on "cash burn rates" and "eyeballs."
"Certainly, the Nasdaq at 5,000 conjures up images of a tech bubble," said Jack Ablin, chief investment officer at BMO Private Bank. "But we've had time for business profits to grow into those crazy expectations 15 years ago."
As the tech-mania took hold, investors pushed up the prices of all kinds of internet-related stocks. Some were never profitable and disappeared. Others, like Priceline.com and Amazon, have survived and prospered.
The Nasdaq, while still focused on technology companies, is a little more diversified than it was back then. And while the index, which tracks 2,500-plus stocks, has been steadily climbing since 2011, its ascent isn't the crazed surge that preceded its last record close.
Here's a look at the Nasdaq then and now.
THE DRIVERS:
— Now
The Nasdaq's current rise has been driven by technology and health care. In a slow-growth world, investors favor industries where earnings will be better than average. This pair qualifies. Tech stocks are poised to benefit as companies increase their spending on equipment and software to cut costs and improve productivity. Health care stocks have been climbing as investors bet that biotechnology companies will discover the next blockbuster drug.
Together, tech and health account for almost two thirds of the Nasdaq's market value.
"Stocks follow earnings, and both tech and health care have been standouts," said Jim McDonald, chief investment officer at Northern Trust.
One stock in particular holds sway over the Nasdaq: Apple. Its market value has surged to over $750 billion from $22.5 billion in March 2000. The company accounts for 10 percent of the Nasdaq's market value.
Powered by tech and health care, the Nasdaq has climbed 15 percent over the past year, a more tempered rise than the 109 percent surge in the year before its last peak in 2000.
— Then
The Nasdaq had a much heavier tech-focus in 2000. At its peak, tech stocks made up 65 percent of the index compared with 43 percent today. Telecommunication companies were also a big component, accounting for 12 percent of the index's market value versus 0.8 percent now.
The biggest stock in the index was Microsoft with a market valuation of $525 billion. Apple had yet to release the iPod, iPhone or the iPad.
HOW EXPENSIVE ARE STOCKS?
— Now
The price-earnings ratio of the Nasdaq, a measure of how much investors are willing to pay for every dollar of earnings the companies in the index generate, is 20.

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