Japan’s main stock index was the Nikkei 225 when it peaked during the 1989 asset-price bubble.
The Nikkei 225 reached an all-time closing high of 38,915.87 on December 29, 1989. The peak came after years of rising land and share prices, rapid credit growth, and strong optimism about Japan’s economic power. Japanese banks and corporations were deeply involved in the expanding asset market.
The bubble burst around the start of the 1990s. Equity prices fell, land values weakened, and financial institutions accumulated nonperforming loans. Japan then entered a prolonged period of slow growth and deflation often called the “Lost Decades,” although the timing and length of that description are debated.
The Nikkei 225 is a price-weighted index of 225 major companies listed on the Tokyo Stock Exchange. It is not identical to TOPIX, which uses a different methodology and broader coverage. The 1989 record remained below its later levels for decades, making the bubble’s collapse an important example of a long-lasting market downturn.