October 19, 1987, saw the Dow Jones Industrial Average fall 22.6 percent, the largest one-day percentage decline in its history.
The date is known as Black Monday. The Dow lost 508 points, while other major markets also suffered steep falls. Unlike a gradual bear market, the decline happened during a single trading session amid intense selling and rapidly changing prices.
Researchers have examined several contributing factors, including unusually high valuations, global market contagion, program trading, portfolio insurance, and investor reactions to earlier weakness. Automated strategies could amplify selling when liquidity was already thin. Afterward, regulators introduced coordinated trading halts, commonly called circuit breakers, to provide time for information to spread and orders to stabilize.
The 22.6 percent figure refers to the Dow’s percentage change from the prior close, not its largest point loss in every possible comparison. The event remains a benchmark for measuring extreme daily equity-market volatility.