WhyItDropped

Nikkei 225 · October 29, 1997

Back the next day

+3.34%

single-day change vs previous close

Part of a longer stretch

When the banks themselves failed

midway through · 1996-06-26 → 1998-10-09, -43.18% over the whole period

What happened that day?

  • On 29 October 1997 the Nikkei 225 rose 3.34%
  • It came right after the global drop set off by Hong Kong
  • US markets had rebounded hard overnight on record volume, and Asia followed
  • Traders decided that US corporate earnings were not that closely tied to Asia
  • Japan's position was different, though. Its lending into Asia really was going bad
  • So the bounce did not last. Three weeks later major financial institutions closed
  • In this stretch the index was 28.73% below its peak

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.