On Monday, stock markets across Asia and Europe experienced significant declines following China’s response to heightened U.S. tariffs. This event has rekindled memories of previous market disturbances similar to those witnessed during the Covid-19 pandemic and the global financial crisis.
Market analysts characterized the downturn as “historic,” with some even referring to it as a “bloodbath,” reminiscent of major market collapses since the early 20th century.
### 2020: Pandemic Impact
In March 2020, global stock markets plummeted after the World Health Organization identified Covid-19 as a pandemic, leading to widespread lockdowns. On March 12, 2020, a day following the pandemic announcement, significant drops were recorded in major stock indexes: Paris fell by 12%, Madrid by 14%, Milan by 17%, London by 11%, and New York witnessed its largest decline since 1987 at 10%. The subsequent days saw U.S. indexes decline by more than 12%. However, swift actions by national governments to sustain their economies contributed to a market rebound within months.
### 2008: Subprime Mortgage Crisis
The global financial crisis of 2008 originated from U.S. bankers issuing subprime mortgages to financially unstable individuals and subsequently packaging them as investments, which spurred a housing boom. As borrowers defaulted on their mortgages, millions faced foreclosure, leading to a stock market crash and a strained banking system, highlighted by the high-profile collapse of Lehman Brothers investment bank. From January to October of that year, major global stock markets experienced declines of 30% to 50%.
### 2000: Dot-com Bubble Burst
The onset of the new millennium was marked by the bursting of the technology bubble, which was fueled by venture capital investment in untested companies. The U.S. Nasdaq index, known for its tech focus, fell by 39.3% from its peak of 5,048.62 points on March 10, 2000, over the course of the year. Many internet startups were forced to shut down as a result.
### 1987: Black Monday
On October 19, 1987, Wall Street faced a crash driven by large U.S. trade and budget deficits along with interest rate increases. The Dow Jones Industrial Average plunged by 22.6%, triggering widespread panic in global markets.
### 1929: Wall Street Crash
October 24, 1929, became infamous as “Black Thursday” on Wall Street, as a booming market collapsed, causing the Dow Jones to lose more than 22% of its value during the opening of trade. Although stocks regained a significant portion of their losses by the end of the day, the downturn persisted. The subsequent losses on October 28 and 29 were pivotal in triggering the onset of the Great Depression in the United States, resulting in a widespread global economic crisis.
This report was initially published by Fortune.
