The Nikkei 225 peaked at 38,915.87 on December 29, 1989, before Japan's market crash.
The index's record marked the high point of Japan's late-1980s asset-price bubble. Japanese land and equity prices had surged amid abundant credit, strong optimism, and rapid financial expansion. When the Bank of Japan tightened monetary policy and the bubble began to deflate, share prices entered a prolonged decline.
The Nikkei 225 is a price-weighted index of 225 major companies listed on the Tokyo Stock Exchange's Prime Market. It is commonly used as a headline measure of Japanese equities, though it is not the only important Japanese index. TOPIX, for example, uses a different construction and covers a broader group of companies.
The 1989 peak was followed by a severe bear market often associated with Japan's “Lost Decades.” The Nikkei's fall was connected to a wider banking and property crisis, so the episode was more than a temporary stock-market correction.