Japan’s Nikkei 225 reached its pre-crash peak closing level of 38,915.87 on December 29, 1989.
The record came near the end of Japan’s enormous late-1980s asset-price bubble. Stock and land prices had risen dramatically, supported by easy credit, optimistic expectations, and heavy lending by Japanese financial institutions. When the Bank of Japan tightened monetary policy and the bubble burst, equity and property values began a prolonged decline.
The Nikkei’s fall is often discussed alongside Japan’s “Lost Decades,” although the economic story includes more than the stock market alone. Banks carried bad loans, companies reduced investment, and deflation became a persistent problem. The index did not regain its 1989 closing record for many years.
A common mix-up is to confuse the Nikkei’s 1989 closing peak with its intraday high. The intraday record was slightly higher, at 38,957.44, also reached on December 29.