A US stock rally supercharged by excitement over artificial intelligence is drawing comparisons with the dotcom bubble two decades ago, raising the question of whether prices have again been inflated by optimism over a revolutionary technology.

AI fever, coupled with a resilient economy and stronger earnings, has lifted the S&P 500 index to fresh records this year following a run of more than 50 per cent from its October 2022 low. The tech-heavy Nasdaq Composite index has gained over 70 per cent since the end of 2022.

While various metrics show stock valuations and investor exuberance have yet to hit peaks reached at the turn of the century, the similarities are easy to spot. A small group of massive tech stocks including AI chipmaker Nvidia symbolise today's market, recalling the "Four Horsemen" of the late 1990s: Cisco, Dell, Microsoft and Intel.

The dizzying run in shares of Nvidia, which gained nearly 4,300 per cent in a recent five-year period, stirred memories of how network equipment maker Cisco surged about 4,500 per cent over five years leading up to its peak in 2000, according to a BTIG comparison of the two stocks.

Valuations have grown as well, though many tech champions appear to be in far better financial shape than their dot-com counterparts of the late 1990s and early 2000s. Other measures, such as investor bullishness, have yet to reach the frothy heights of the turn of the century. The concern is the AI-driven surge will end the same way as the dot-com boom - with an epic crash. After nearly quadrupling in just over three years, the Nasdaq Composite plunged almost 80% from its March 2000 peak to October 2002. The S&P 500, which doubled in a similar timeframe, collapsed nearly 50 per cent in that period. While several internet stocks such as Amazon survived and eventually thrived, others never recovered. IT sector has swelled to 32 per cent of the S&P 500's total market value, the largest percentage since 2000, with just three companies, Microsoft, Apple and Nvidia, representing over 20 per cent.