The S&P 500 Over the Past 30 Years: A Retrospective on Resilience, Growth, and Transformation

Gene McCombs
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3 min read

Over the last three decades, the S&P 500 index—a benchmark representing the performance of 500 of the largest publicly traded companies in the United States—has evolved into a mirror of economic sentiment, technological change, and global events. From the dot-com boom of the late 1990s to the COVID-19 pandemic and beyond, the index has weathered shocks, embraced innovation, and delivered substantial long-term growth.

1995–2000: The Tech Boom and Roaring Bull Market

The mid-to-late 1990s were marked by rapid economic growth and a burgeoning internet sector. Between 1995 and 2000, the S&P 500 nearly tripled, fueled by optimism surrounding the "New Economy" and digital innovation. Technology companies, many of which were startups, saw valuations skyrocket—even if profits were scarce.

Notable high: In March 2000, the S&P 500 reached a then-record high of 1,527 points.
Annualized return (1995–2000): ~18%

But the exuberance wasn’t to last. When the dot-com bubble burst in 2000, the index began a multi-year decline.

2000–2009: The Lost Decade

The first decade of the 2000s was turbulent. Following the dot-com crash, the 9/11 attacks in 2001, and the 2008 Global Financial Crisis, investor confidence was repeatedly shaken.

The 2008 crisis led to a 57% drop in the S&P 500 from its 2007 peak to its 2009 trough.
By March 2009, the index had fallen to around 676—its lowest level in over a decade.
Annualized return (2000–2009): ~ -1%

Despite the turmoil, this period sowed the seeds for future growth. Companies trimmed costs, restructured debt, and embraced more sustainable practices.

2009–2019: A Decade of Recovery and Expansion

Starting in March 2009, the S&P 500 embarked on one of the longest bull markets in history, largely driven by low interest rates, quantitative easing, and a resurgence in corporate profitability.

Tech resurgence: Companies like Apple, Microsoft, Amazon, and Alphabet became dominant forces.
Milestone: The S&P 500 crossed 3,000 points for the first time in 2019.
Annualized return (2009–2019): ~13%

This era was also characterized by significant innovation in sectors like cloud computing, e-commerce, and financial technology.

2020–2023: Pandemic Panic and a Rapid Rebound

The COVID-19 pandemic triggered a sharp selloff in early 2020. In just a few weeks, the S&P 500 plunged more than 30%. However, massive fiscal stimulus and aggressive monetary policy helped ignite a swift recovery.

By August 2020, the index had not only recovered but began setting new all-time highs.
2021 highs: The S&P 500 reached above 4,700 in late 2021.
Challenges: 2022 brought volatility due to inflation fears, interest rate hikes, and geopolitical tensions, leading to a notable correction.

2023–2025: Cautious Optimism and AI-Driven Growth

As of early 2025, the S&P 500 has returned to growth, buoyed by innovation in artificial intelligence, green energy, and semiconductor manufacturing. Mega-cap tech stocks have led the charge once again, supported by resilient consumer demand and improving macroeconomic indicators.

Key themes: AI integration, reshoring of supply chains, and a transition to a low-carbon economy.
S&P 500 level (approximate, early 2025): Around 5,200 points.
Annualized return (1995–2025): ~9.5% — a testament to the index’s long-term strength.

Conclusion: Lessons from Three Decades

The S&P 500’s performance over the past 30 years underscores a few enduring lessons:

Volatility is inevitable, but time in the market beats timing the market.
Innovation drives growth, and the index continually adapts to reflect the economy's evolving landscape.
Diversification matters—sectors rise and fall, but the index as a whole benefits from structural shifts over time.

For long-term investors, the S&P 500 remains a powerful vehicle for wealth accumulation, offering a blend of growth, resilience, and historical perspective in an ever-changing world.