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This Month in Business History

The Black Monday Stock Market Crash

Rollin Kirby, artist. Sold out. 1929. Library of Congress Prints and Photographs Division.

Just as the stock market crash of October 28, 1929, has forever come to be remembered as "Black Tuesday," so October 19, 1987, has come to be known as "Black Monday." It was on this day that the stock market again crashed, precipitating one of the first financial crises of the modern globalized era, as the Dow Jones Industrial Average (DJIA) dropped 508 points, or 22.6% of its value.1

Within that one day, over $500 billion was lost from the Dow Jones Index.2 When people heard what was happening on Wall Street, they tried to contact their brokers, but could not reach them due to the influx of phone calls. Millions were lost instantly.

The DJIA was not the only market affected. The National Association of Securities Dealers Automated Quotations (NASDAQ) also recorded its all-time record one day loss of 11.35% and did not recover very quickly. The S&P 500 lost 58 points, or 30% of its value.3

The United States was not the only country in which the stock markets crashed. Markets in Australia, Hong Kong, Singapore, and Mexico also took a beating. Around the world stock market values were plunging, causing a rampant fear that this event would mimic the October 28, 1929, stock market crash, which contributed to the Great Depression of the 1930's. However, this proved not to be the case. In just a little over two years, the Dow surpassed its all-time high of August 25, 1987. "From that point it never looked back as it began its historical climb upwards in the 1990s, producing the biggest and longest bull market in history."4

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  1. Wright, Russell O. Chronology of the Stock Market. Jefferson, NC: McFarland, 2002. p.69. See also Michaels, James W. "Black Monday and Red Faces," Forbes. New York: Nov 3, 1997. Volume 160, Issue 10; pgs. 44-45. Back to text
  2. Wall Street's October Massacre External by Gordon Bock, Rosemary Byrnes, and Frederick Ungeheuer. Time Magazine. Monday, Oct. 26, 1987. Accessed February 8, 2021. Back to text
  3. Wright, p.70. Back to text
  4. Wright, p.70. Back to text