Black Monday
Black Monday occurred on Oct. 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. The event marked the beginning of a global stock market decline, and Black Monday became one of the most notorious days in financial history. By the end of the month, most of the major exchanges had dropped more than 20%.Economists have attributed the crash to a combination of geopolitical events and the advent of computerized program trading that accelerated the selloff.
Black Monday
Definition
Black Monday refers to the global stock market crash that occurred on October 19, 1987. On this day, the Dow Jones Industrial Average (DJIA) plummeted nearly 22% in a single day, marking the beginning of a significant global market downturn. Black Monday is considered one of the most infamous days in financial history.
Origin
The origin of Black Monday dates back to October 19, 1987. On this day, the Dow Jones Industrial Average (DJIA) dropped nearly 22% in a single day. This event is believed to have been caused by a combination of geopolitical events and computerized program trading that accelerated the sell-off.
Categories and Characteristics
Black Monday is a type of stock market crash characterized by:
- Suddenness: The market experiences a significant drop in a very short period, typically within a single day.
- Global Impact: It affects not only the U.S. stock market but also major exchanges worldwide.
- Multi-factor Driven: It is usually triggered by a combination of factors, including geopolitical events, market sentiment, and technical trading.
Specific Cases
Case 1: On October 19, 1987, the Dow Jones Industrial Average (DJIA) dropped 508 points, nearly 22%, in a single day. This event triggered a chain reaction in global stock markets, leading to significant declines in other major exchanges.
Case 2: Following Black Monday, the Hong Kong Hang Seng Index fell by 33% on October 26, marking the largest single-day drop in the region's history. This event further exacerbated global market panic.
Common Questions
Q: What were the main causes of Black Monday?
A: The main causes of Black Monday were a combination of geopolitical events and computerized program trading that accelerated the sell-off.
Q: What was the impact of Black Monday on the global economy?
A: Black Monday led to significant declines in global stock markets, eroding investor confidence and having a short-term negative impact on the global economy.
