The Nikkei 225 peaked at 38,957.44 on December 29, 1989, before Japan's prolonged market crash.
The record came at the height of Japan's late-1980s asset-price bubble. Easy credit, optimistic expectations, and rapidly rising property and share prices encouraged speculation. The Bank of Japan then tightened monetary policy, and the bubble began to deflate.
Japanese stocks fell sharply during the early 1990s, while property prices also declined. The Nikkei's fall became associated with Japan's “lost decades,” a period marked by weak growth, financial-sector problems, and persistent deflationary pressures. The index remained far below its 1989 peak for many years.
A common mix-up is the TOPIX, another important Japanese benchmark. The question's exact record level belongs to the Nikkei 225, an index of 225 prominent companies listed on the Tokyo Stock Exchange's Prime Market. The peak date is December 29, the final trading day of 1989.