WhyItDropped

S&P 500 · August 27, 1990

The day oil eased and the market took it back

+3.19%

single-day change vs previous close

Part of a longer stretch

The Gulf War bear market

midway through · 1990-07-16 → 1990-10-11, -19.92% over the whole period

What happened that day?

  • The S&P 500 rose 3.19% on the day — the largest single gain of this decline
  • **No single cause for that day has been pinned down.** What is established is that it gave back almost exactly the fall of four sessions earlier
  • Share prices in this period moved almost as a mirror of oil: up when crude fell, down when it rose
  • What the market recalculated every day was one thing — whether there would be a war, and how much crude supply it would cut
  • This retracement was not a turn. The index fell for another six weeks and bottomed in mid-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.