The Black Monday - 19 Oct 1987

Black Monday refers to the stock market crash on October 19, 1987, when global markets, including the Dow Jones Industrial Average, plummeted by about 22.6%. The crash was triggered by a combination of factors, including program trading, overvaluation, and market psychology, leading to widespread panic selling. Summary of the Timeline Leading to Black Monday August 25, 1987: The Dow jones hits a record high of 2746, raising concerns about overvaluation and rising interest rates. September 1987: Increased volatility occurs as mixed corporate earnings reports heighten investor anxiety about a market correction. October 14, 1987: The U.S. House Committee on Ways and Means introduces a bill to reduce tax benefits for mergers and leveraged buyouts, causing investor concerns about corporate financing. Additionally, high trade deficit figures are announced, negatively affecting the U.S. dollar and contributing to rising interest rates, leading to a 95-point drop in the Dow Jones. October 15-16, 1987: The market continues to decline amid fears of rising interest rates and geopolitical tensions. market has been fallen 12% in last 3 sessions. October 17, 1987: A slight recovery occurs, but negative sentiment persists due to recent economic developments. October 19, 1987 (Black Monday): The market opens sharply lower, resulting in panic selling and a historic 508-point drop in the Dow (22.6%), ended at 1738. Contributing factors include program trading, overvaluation, rising interest rates, market psychology, and a lack of circuit breakers. Aftermath: The crash leads to regulatory changes, including the introduction of circuit breakers, and the market eventually recovers in subsequent years. #dowjones #blackmonday #marketcrash #tariff #donaldtrump