The Nikkei 225 reached its record closing high on December 29, 1989, before Japan’s asset bubble burst.
The index closed at 38,915.87 on that date. The peak came after years of rapidly rising Japanese stock and land prices, abundant credit, and strong confidence in Japan’s economic model. The Nikkei then entered a prolonged decline as asset prices collapsed and financial institutions carried bad loans.
The bubble’s reversal affected banks, corporations, households, and government finances. Japan’s economy experienced weak growth and periods of deflation during what became known as the Lost Decades. The stock-market fall was part of a broader asset-price collapse rather than an isolated share-market event.
The Nikkei 225 is a price-weighted index of 225 prominent companies listed on the Tokyo Stock Exchange’s Prime Market. It is not the same as TOPIX, which uses a different methodology and market coverage. The 1989 record remained below later nominal highs for decades.