The Nikkei 225 peak marked the collapse of Japan’s asset-price bubble and preceded its prolonged market downturn in 1989.
The index reached an intraday high of 38,957.44 on December 29, 1989, after years of rising Japanese share and land prices. Easy credit, strong optimism, and rapidly increasing asset values helped fuel the bubble.
After the peak, Japanese share prices fell sharply, while property values also declined over the following years. Banks were left with large quantities of bad loans, and the economy entered a long period of weak growth often called the Lost Decades. The Nikkei did not return to its 1989 intraday peak for many years.
The event is sometimes described too simply as a single crash. The late-1980s peak was a turning point, but the broader downturn unfolded over years and involved banking problems, debt repayment, deflation, and policy responses. The Nikkei 225 is an index of major Japanese stocks, not the name of the bubble itself.