How Much Did the Nasdaq Fall in Each US Recession Since 1971?
Direct answer
Stocks and recessions
Stocks usually fall sharply around a recession, but the timing surprises most people: markets tend to drop before the recession is declared and start recovering before it ends. Using NBER recession dates and Nasdaq Composite data on FRED, the index's largest fall from a high in the six months before each of the seven recessions since 1973 to its end ranged from 24.9% (1980) to 60.1% (2001). Yet measured only from the first to the last recession month, it rose in five of the seven, including 2001 and 2020, because the worst losses came earlier.
- Seven US recessions since 1973 (NBER dates)
- Nasdaq's biggest drop in each window: 24.9% to 60.1%
- Measured over the recession months alone, the index rose in 4 of 7
- Markets usually bottom before the recession officially ends
Recession headlines make investors nervous, and for good reason: the biggest bear markets of the past 50 years were tied to recessions. But the relationship between the economy and stock prices is less direct than "recession = stocks fall".
What people on X are asking
In May 2025 a financial news outlet asked plainly what happens to the stock market in a recession?. In August 2025 another user asked what happens to the stock market if consumers cut back on spending. In April 2025, during the tariff sell-off, a post reasoned that a recession would be needed for stocks to fall another 20%. We checked what actually happened in each recession since the early 1970s.
The fact-checked answer
UXS chart
Nasdaq Composite since 1971 (log scale)
Nasdaq Composite: latest
25,253
November 9, 2026
Highest in chart period
27,600
October 6, 2026
Lowest in chart period
54.87
October 3, 1974
Change over 1 year
+9.8%
vs November 7, 2025
Year by year: Nasdaq Composite
Computed by UXS from the same data as the chart. Tap a column header to sort. * = year to date (latest data November 9, 2026).
| 2026* | 25,253 | +8.7% | 27,600 | 20,795 |
| 2025 | 23,242 | +20.4% | 23,958 | 15,268 |
| 2024 | 19,311 | +28.6% | 20,174 | 14,510 |
| 2023 | 15,011 | +43.4% | 15,099 | 10,305 |
| 2022 | 10,466 | -33.1% | 15,833 | 10,213 |
| 2021 | 15,645 | +21.4% | 16,057 | 12,609 |
| 2020 | 12,888 | +43.6% | 12,899 | 6,860.67 |
| 2019 | 8,972.60 | +35.2% | 9,022.39 | 6,463.50 |
| 2018 | 6,635.28 | -3.9% | 8,109.69 | 6,192.92 |
| 2017 | 6,903.39 | +28.2% | 6,994.76 | 5,429.08 |
| 2016 | 5,383.12 | +7.5% | 5,487.44 | 4,266.84 |
| 2015 | 5,007.41 | +5.7% | 5,218.86 | 4,506.49 |
How recessions are dated. In the US, the National Bureau of Economic Research's Business Cycle Dating Committee decides when recessions start and end. Its definition is a significant decline in economic activity that is spread across the economy and lasts more than a few months, judged from a broad set of indicators rather than a single rule such as two negative quarters of GDP. It announces dates months after the fact. FRED's USREC series marks each month between an NBER peak and trough.
What the data show. For each recession we measured two things on the Nasdaq Composite: the change from the last close before the first recession month to the last close in the final recession month, and the largest fall from a high, counting from six months before the recession to its end.
Nasdaq Composite in US recessions since 1973
Computed by UXS from FRED NASDAQCOM (daily closes) and USREC (NBER-based monthly indicator). The 2001 window starts in October 2000, so it misses part of the earlier fall from the March 2000 peak. Tap a column header to sort.
| Dec 1973 – Mar 1975 | −19.1% | −51.9% | Oct 1973 → Oct 1974 |
| Feb – Jul 1980 | +6.2% | −24.9% | Feb 1980 → Mar 1980 |
| Aug 1981 – Nov 1982 | +9.8% | −28.8% | May 1981 → Aug 1982 |
| Aug 1990 – Mar 1991 | +10.1% | −30.7% | Jul 1990 → Oct 1990 |
| Apr – Nov 2001 | +4.9% | −60.1% | Oct 2000 → Sep 2001 |
| Jan 2008 – Jun 2009 | −30.8% | −55.6% | Oct 2007 → Mar 2009 |
| Mar – Apr 2020 | +3.8% | −30.1% | Feb 2020 → Mar 2020 |
Lesson 1: the fall is real. In every recession the index suffered a drop of at least about 25% in the window, and in three of them (1973–75, 2001 and 2008–09) it lost more than half its value. Those are the episodes behind long bear markets.
Lesson 2: markets move first. In four of seven cases, the index was higher at the end of the recession than at the start. That is because prices fall when investors start expecting a downturn, often before it begins, and rise when they start expecting recovery, often while unemployment is still rising. In 2020 the Nasdaq bottomed on March 23, in the first month of the recession, and was up 3.8% by the end of April. Waiting for the economy to look good again has usually meant missing a large part of the rebound.
Lesson 3: not every big fall is a recession. The Nasdaq has dropped 20% or more outside recessions too, including 1987 and 2022. And not every recession scare becomes a recession: in 2022–23 an inverted yield curve and weak sentiment did not produce an NBER recession.
UXS decision diagram
Is a recession already priced in?
Text version of the diagram
- Has the index already fallen 20% or more from its high? If no: Further downside is possible if a recession arrives
- Are credit spreads widening sharply? If yes: Stress is spreading; watch for forced selling
- Are earnings forecasts still being cut? If yes: Prices may not have bottomed
- Is the Fed cutting rates and are spreads narrowing? If no: Recovery signals are not yet in place
- Otherwise: Markets often bottom here, before the economic data improve
Diagram drawn by UXS. A simplified decision aid for education, not a recommendation.
What tends to hold up. In past recessions, defensive sectors (consumer staples, utilities, health care) and high-quality bonds generally fell less than cyclical and growth stocks, and cash kept its value. Diversification does not prevent losses, but it limits how much one shock can hurt. Check credit spreads and what happens when the Fed cuts rates for related signals.
Decision helper
| If you are… | Consider |
|---|---|
| A long-term investor | Keep investing on schedule; recessions have historically been temporary |
| Close to needing the money | Hold enough in cash and bonds not to sell stocks at the low |
| A trader | Expect higher volatility and wider spreads |
| Waiting for "the bottom" | It usually comes before the good news |
Common mistakes
- Selling after a recession is officially announced, often near the low.
- Assuming a recession must mean stocks fall from the day it starts.
- Ignoring that the worst falls (2001, 2008) lasted years, not months.
- Confusing a recession forecast with an actual recession.
FAQ
Do stocks always fall in a recession?
Around recessions they have fallen at least about 25% from a recent high, but over the recession months alone they rose in four of seven cases.
How much do stocks fall in a recession?
On the Nasdaq Composite, the largest falls in the window ranged from 24.9% (1980) to 60.1% (2001).
Do stocks bottom before a recession ends?
Usually, yes. In 2020 the Nasdaq bottomed on March 23, in the first month of the recession.
Who decides when a recession starts?
The NBER's Business Cycle Dating Committee in the US.
What is the best investment in a recession?
There is no single answer; historically, defensive sectors, high-quality bonds and cash fell less.
Can stocks crash without a recession?
Yes, as in 1987 and 2022.
Sources
- NBER: Business cycle dating
- FRED: NBER-based recession indicator (USREC)
- SEC Investor.gov: Diversify your investments
- FINRA: Day trading
Facts checked November 10, 2026. X posts are cited as evidence of the question, not of the answer.