A period of time during which sales of a product or business activity increases very rapidly. In the stock market, booms are associated with bull markets, whereas busts are associated with bear markets. The cyclical nature of the market and the economy in general suggests that every strong economic growth bull market in history has been followed by a sluggish low growth bear market.


Stocks that suddenly become very popular and gain strong elevated market profits are the result of a stock boom. An example of this is the internet technologies boom or "dot-com bubble" that occurred during the late '90s. This was one of the most famous booms in stock market history. As often occurs in a boom-and-bust cycle, this boom was followed by one of the biggest busts in history. This occurs because the growth that takes place in a boom is rarely maintained and backed up by actual company profits.

  1. Business Cycle

    The fluctuations in economic activity that an economy experiences ...
  2. Demographic Dividend

    The freeing up of resources for a country's economic development ...
  3. Boomlet

    A small but sharp increase in business activity, political activity ...
  4. Rebound

    In financial terms, a rebound means a recovery from prior negative ...
  5. Bear

    An investor who believes that a particular security or market ...
  6. Economy

    The large set of inter-related economic production and consumption ...
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  1. Why would growth investors be attracted to the electronics sector?

    Growth investors gravitate toward the electronics sector because its higher-than-average volatility, particularly in the ... Read Full Answer >>
  2. What is the internet sector?

    According to the Department of Homeland Security (DHS), the Internet sector is a collaboration between the information technology ... Read Full Answer >>
  3. Where do penny stocks trade?

    Generally, penny stocks are traded through the use of the Over the Counter Bulletin Board (OTCBB) and through pink sheets. ... Read Full Answer >>
  4. Where can I buy penny stocks?

    Some penny stocks, those using the definition of trading for less than $5 per share, are traded on regular exchanges such ... Read Full Answer >>
  5. How does the stock market react to changes in the Federal Funds Rate?

    The stock market reacts to changes in the federal funds rate in various ways depending on where it is in the business cycle. ... Read Full Answer >>
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