The FTSE 100 fell 12.2% on 20 October 1987, the day after the U.S. Black Monday collapse.
The London market’s loss came one day later because of the time difference between U.S. and European trading. The FTSE 100 dropped from 2,236.8 to 1,738.7, a fall of 497.4 points. The decline was part of a worldwide market shock rather than an isolated British event.
Black Monday’s international spread reflected tightly connected financial markets, rapid communications, and investors’ use of similar portfolio strategies. In London, concerns about U.S. markets, exchange rates, interest rates, and computerized selling combined to produce extreme volatility.
The FTSE 100 should not be confused with the Dow Jones Industrial Average. The Dow’s percentage loss on 19 October was 22.6%, while the FTSE 100’s worst Black Monday-related session was 20 October. Different closing times and index compositions explain why the dates and percentages differ.