Which index was central to the 1989 crash of Japan’s stock market?

The Nikkei 225 was the central index in the 1989 crash of Japan’s stock market.

The Nikkei 225 is a price-weighted index of 225 major companies listed on the Tokyo Stock Exchange. It reached its historic peak on 29 December 1989, when it touched 38,957.44 during Japan’s asset-price bubble.

After the bubble burst, the index fell for years as property prices declined, banks accumulated bad loans, and corporate investment weakened. The Nikkei became a widely used measure of Japan’s prolonged financial and economic stagnation during the 1990s and early 2000s.

TOPIX is another important Japanese index, but it is broader and uses a different methodology. The Hang Seng Index represents Hong Kong equities, while the KOSPI represents South Korean equities. Identifying the index matters because several Asian markets experienced major crises in the same general period, but the 1989 peak specifically refers to the Nikkei 225.