WhyItDropped

S&P 500 · August 23, 1990

The day after the reserves were called up

-3.00%

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 fell 3% on the day
  • Iraq had invaded Kuwait three weeks earlier, and the United States had announced a call-up of reserves the day before
  • Oil jumped that day to its highest level since the early 1980s, because a large share of the world's crude came out of that region
  • The US economy was already turning down that year. The oil spike was a weight added on top, and a recession was formally dated from late that year
  • This decline ended in mid-October, and the market turned before the war began
  • Across the stretch as a whole the fall ran three months

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.