There was no such stagnation. This is the period which saw M-theory, the holographic principle, and the twistor revival,
I understand M theory sufficiently well to be seriously underwhelmed.
M theory and the holographic principle suspiciously resemble postmodernism: insiders talking to each other in ways that supposedly demonstrate their erudition, without any external check to verify that they are actually erudite, or even understand each other, or even understand what they themselves are saying. Twistors are valid and erudite mathematics, but don’t seem to get us any closer to anything interesting.
M theory is just string theory only more so. The trouble with string theory as a theory of spacetime is that it takes place in a fixed space time background, thus inherently makes no sense whatever. If you start with a contradiction, you can deduce anything you please. The central problem in any quantum theory of spacetime is that you have no fixed spacetime to stand upon, and string theory just blithely ignores the problem. That is not an advance in theoretical physics, that is finding weak excuses to publish meaningless papers.
I don’t think string theory as it exists is capable of of describing a space time that undergoes topological change as a result of the dynamics of the strings. They talk about branes undergoing topological change, but they undergo topological change within a given background spacetime that acts without being acted upon.
And if it is capable of describing such an event, string theorists don’t really have any idea of how to make it do it.
People go into Quantum Gravity because it is the big unsolved problem, find they cannot solve it, but they have to publish papers anyway. And so they do, resulting in postmodern physics.