WhyItDropped

S&P 500 · October 13, 1989

The 1989 Mini-Crash

-6.12%

single-day change vs previous close

What happened that day?

  • Friday 13 October 1989 — S&P 500 fell 6.12%
  • Late in the session, news broke that financing for a large airline buyout had fallen through
  • Much of the market's rise rested on takeover expectations. Shares of plausible targets had risen on that expectation alone
  • When the deal collapsed, the premise wobbled. If financing had deteriorated, other deals would struggle — and prices held up by expectation lose their basis
  • Drawdown stopped at 10.23%, with a quick recovery
  • A far shallower correction than Black Monday two years earlier

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.