S&P 500 · September 30, 1998

Disappointment the day after the cut

-3.05%

single-day change vs previous close

Part of a longer stretch

The rally after LTCM

midway through · 1998-08-31 → 1998-11-23, +24.12% over the whole period

What happened that day?

30 September 1998 — the S&P 500 fell 3.05% to close at 1,017.01. No single cause can be pinned to the day
The Fed had cut by one step the day before. The market had been looking for a bigger step, or for a run of them
A week earlier a large hedge fund had collapsed and the major banks had been gathered to hold it up. That fear had not cleared
It was also the last day of the quarter, which stacks book-tidying sales onto the same session
The next day fell by a similar amount. Over two sessions the market decided one cut was not going to be enough
The Fed cut twice more after this, and only then did the market turn
From the mid-July high to the 31 August low the index fell 19.34%

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 put together from the public record; where a specific source was consulted it is listed above.