The Nikkei 225 fell sharply after Japan's asset-price bubble burst in the early 1990s.
Japan's late-1980s bubble drove extraordinary increases in land and share prices. The Nikkei 225 reached an intraday high of 38,957.44 on December 29, 1989. As monetary conditions tightened and asset prices turned downward, the index entered a prolonged decline.
The collapse contributed to Japan's “Lost Decades,” a period marked by weak growth, falling or stagnant prices, banking problems, and repeated efforts to repair balance sheets. The banking system carried bad loans after property and equity values dropped, making recovery especially slow.
The Nikkei 225 is Japan's best-known stock index, but it is not the country's only major benchmark; the broader TOPIX is also widely followed. The bubble's end is therefore associated with both indexes, while the Nikkei's 1989 peak provides the most recognizable reference point.