Explaining the 12.4% Nikkei Plunge on Monday (Frankie says relax)
The Western world woke up on Monday to news of the biggest single-day drop on Japanese stock markets since Black Monday in 1987. What happened? And how can investors keep focused on the long-term?
Now that I'm living in England and five hours ahead of New York and Toronto, I get a head start on seeing what news is going to hit the headlines in North America. And boy was Monday morning something else. The Nikkei 225 (Japan's main stock market index) had its biggest one day drop since Black Monday. Well, technically, since "Blue Tuesday". While Black monday refers to Monday, October 19th, 1987, again, owing to the time difference, the bad news of that day didn't reach Japanese markets until the following day, where the reaction was a bit more muted. Hence, it's known as Blue Tuesday there (October 20th, 1987). But I digress.
But... we are human and it is totally normal to get worked up by the headlines. That's what they are in the business of doing in the battle for attention in a world with ever-increasing noise. Perhaps this video will help reduce some investor anxiety by explaining a bit about what happened and provide some tips to try and help focus on the long-term.
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