Mexico’s currency devaluation triggered the 1994 Mexican stock-market crash.
In December 1994, Mexico devalued the peso after pressure on its foreign-exchange reserves and fixed exchange-rate policy. Investors rapidly withdrew capital, causing the peso to lose much of its value and sending Mexican share prices and bonds sharply lower. The episode became known as the Mexican peso crisis or Tequila Crisis.
The country had accumulated substantial short-term dollar-linked obligations, including tesobonos. Once confidence disappeared, refinancing became difficult. The United States and international institutions assembled a rescue package to help Mexico meet its obligations and stabilize markets.
The crisis also affected other emerging markets, especially in Latin America. It is sometimes confused with Mexico’s 1982 debt crisis, but the stock-market shock in this question belongs to the 1994–1995 peso crisis, which followed a different combination of exchange-rate and financing pressures.