The Nikkei 225 became the main benchmark during Japan’s early-1990s asset-price crash.
The Nikkei 225 is a price-weighted index of 225 major companies listed on the Tokyo Stock Exchange. It became the most widely recognized public measure of Japan’s extraordinary stock-market boom and subsequent collapse, even though TOPIX is another important Japanese market index.
Japan’s asset-price bubble expanded during the second half of the 1980s. Easy credit, optimistic expectations, and rapidly rising land and share prices helped push valuations to extreme levels. The Bank of Japan tightened policy, and the bubble began to deflate around 1990.
The resulting decline lasted for years and was connected to a broader banking and property crisis. The episode is often called Japan’s “lost decade,” although economic weakness and financial problems extended beyond the 1990s. The Nikkei 225’s 1989 peak was eventually revisited only decades later, making Japan’s crash a major example of how asset bubbles can damage banks, companies, and households after prices turn downward.