Business, Legal & Accounting Glossary
October 19, 1987, was the day on which the DJIA fell 508 points (22%). As of 2009, the losses on this date remain the largest single-day drop the Dow Jones has experienced. It has never been concretely determined what caused this decline, and despite the drop, the Dow Jones still closed positive for the year.
The Crash of 1987, Black Monday, took place on October 19, 1987.
During the Crash of 1987, the Dow lost 22% of its value in one day. Shareholders could not reach their brokers, brokers could not supply prices and computers were overloaded. The Crash of 1987 dwarfed the infamous Black Thursday of 1929. However, unlike the 1929 crash, the Crash of 1987 was short-lived. It took three years, not 35, for the Dow to recover to levels seen prior to the Crash of 1987. To prevent another Crash of 1987, the New York Stock Exchange installed circuit breakers to curb trading during periods of high volatility. Economists cite numerous reasons for the Crash of 1987, including increasing interest rates, high price-earnings ratios, trade, and budget deficits, and program trading.
Black Monday
Black Monday
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This glossary post was last updated: 22nd November, 2021 | 0 Views.