S&P 500 · July 24, 2002

Peak accounting-fraud fear

+5.73%

single-day change vs previous close

Part of a longer stretch

The dot-com bust hits the S&P 500

near the end of it · 2000-03-24 → 2002-10-09, -49.15% over the whole period

What happened that day?

On 24 July 2002 the S&P 500 rose 5.73% in a single day
What crushed the market that summer was accounting fraud. A huge misstatement at a large telecom firm surfaced in June
Coming after Enron, it spread the feeling that reported earnings could not be trusted at all
If you cannot trust the numbers there is no way to value a share, so everyone sold first
In late July the index reached a multi-year low, the sense that it had gone too far spread, and it bounced hard
A law tightening corporate accounting responsibility also helped rebuild trust. The final low came on 9 October

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.