The 1987 stock-market crash was nicknamed Black Monday because its most dramatic trading session occurred on Monday, October 19, 1987. The term became the standard name for that worldwide market collapse.
On that day, the Dow Jones Industrial Average plunged 508 points, or 22.6%. Major markets in Europe, Asia, Australia, and North America also suffered severe losses, making the episode international rather than exclusively American. The name echoes earlier financial disasters such as Black Thursday in 1929, but the dates and causes are different.
Several factors contributed to the 1987 turmoil. Stock valuations were high, interest rates had risen, and investors were worried about trade and currency tensions. Portfolio insurance and other programmed trading methods generated large sell orders as prices fell, which could amplify the decline.
The crash did not produce a 1930s-style economic depression. The Federal Reserve, led by Alan Greenspan, publicly emphasized its readiness to provide liquidity to the financial system. Trading safeguards introduced afterward included market-wide circuit breakers.