The U.S. market crash on 19 October 1987 was Black Monday, an event that helped lead to modern trading circuit breakers.
During the crash, the Dow Jones Industrial Average fell 22.6%, its largest one-day percentage decline. Selling spread internationally, and officials became concerned that automated strategies and market congestion could intensify a sudden fall.
The U.S. Securities and Exchange Commission and exchanges subsequently developed coordinated mechanisms to pause trading during extreme declines. These pauses give investors time to assess information and can reduce disorderly selling.
Black Monday is therefore important not only for its record-setting loss but also for changing market infrastructure. Circuit breakers do not prevent every crash; they are designed to slow abrupt movements and provide a temporary interruption when specified thresholds are reached.