The U.S. stock-market crash on October 19, 1987, was called Black Monday after trading resumed and prices collapsed.
The Dow Jones Industrial Average fell 22.6% that day, while other major markets also suffered steep losses. The decline followed a period of rising prices and growing concern about interest rates, exchange rates, trade imbalances, and the sustainability of valuations.
Automated trading and portfolio-insurance techniques were important features of the episode. Once prices moved lower, programmed selling could increase the supply of shares and worsen the decline, although no single explanation accounts for every market’s performance.
Black Monday should not be confused with Black Tuesday in 1929. The names refer to different crashes, and the 1987 event did not produce a prolonged depression. Central-bank intervention and market reforms helped contain the immediate financial damage.