Japan’s Nikkei 225 closed at 38,915.87 at its pre-crash peak on December 29, 1989.
The record came near the end of Japan’s asset-price bubble, when land and equities had risen dramatically. Easy credit, strong economic expectations, and speculative purchases helped push prices to extraordinary levels. The bubble’s collapse began a long period of falling asset values and economic stagnation.
The Nikkei did not simply drop in a single day. It declined through the early 1990s as banks and companies faced bad loans, property prices weakened, and confidence deteriorated. The index later fell far below its 1989 peak, making the record a lasting reference point in discussions of market bubbles.
The Nikkei 225 is a price-weighted index of 225 major companies listed on the Tokyo Stock Exchange. It is frequently confused with the broader TOPIX index, which uses a different construction and covers a wider portion of the Japanese market.