Market Overview

This Day In Market History: Russian Stocks Drop 6% On Government Insolvency Fears

This Day In Market History: Russian Stocks Drop 6% On Government Insolvency Fears

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened?

On this day 21 years ago, the Russian stock market crashed 6% on fears that the Russian government would default.

Where The Market Was

The Dow Jones Industrial Average closed at 8,459.50 and the S&P 500 traded at 1,074.91.

What Else Was Going On In The World?

In 1998, the European Union agreed to use a single central currency, the euro. U.S. President Bill Clinton was impeached for perjury and obstruction of justice. The average U.S. income was $38,100.

Russian Economy On Brink Of Disaster

What was once thought to be a localized currency crisis in Thailand in mid-1997 spread to other Asian nations across the following year, reaching South Korea, Hong Kong and China by the end of 1997. By 1998, the problems had spread to the economies of Russia and Brazil.

On Aug. 13, 1998, the Russian stock market plummeted 6%, bringing year-to-date losses up to an incredible 75%. Short-term interest rates spiked to an astronomically high 200% during the panic as investors began to seriously doubt the Russian government’s solvency.

After an emergency session of parliament the next day, Russian President Boris Yeltsin announced said “there will be no devaluation” of the ruble. Three days later, on Aug. 17, 1998, Russia announced a devaluation of the ruble and a 90-day moratorium on foreign debt repayment.

Related Links:

This Day In Market History: Atomic Bomb Shuts Down Japan Stock Exchange

The Turkish Crisis: What You Need To Know About Erdogan, The Lira, Turkey

Posted-In: this day in market historyNews Education Global Top Stories Markets General Best of Benzinga


Related Articles (RSX)

View Comments and Join the Discussion!
Fastest Market News Application
You'll Hear It First On Pro
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at

The Daily Biotech Pulse: Jazz Goes Shopping, Portola Offering, Novelion Delays Quarterly Results

76 Biggest Movers From Yesterday