Hong Kong’s stock exchange experienced the first major market crash of the 1987 Black Monday episode.
The Hong Kong market began collapsing before the United States reached its famous October 19 trading session. The Hang Seng Index fell dramatically, and the exchange closed for several days from October 20 to October 23 to help restore orderly trading.
Selling then moved through international markets. Australia, Spain, the United Kingdom, Canada, and the United States recorded severe declines, demonstrating how increasingly connected financial markets had become. The crisis was global rather than limited to Wall Street.
New York’s Dow Jones loss became the best-known statistic because of its record percentage decline, but Hong Kong’s earlier plunge is an important part of the chronology. The episode also encouraged regulators to improve coordination among exchanges and financial authorities.