On Monday, Oct. 27, 1997, a currency crisis in Asia reached Wall Street. The S&P 500 fell 6.9%, and the New York Stock Exchange closed early for the first time under its crash rules.
A week later the fear looked overdone. By Nov. 3, stocks had won back almost all of the loss. Say an investor decided the scare was over and put $10,000 into the S&P 500 at that day's close.
That investor's choice is on the table again this morning. The S&P 500 fell 4.4% on Nov. 5, its worst day since April 2025. By Thursday's close it had recovered 71% of that drop.
Anyone buying now is betting the rebound is real. Here is how that bet went in 1997, and for a buyer eight years earlier whose rebound did not hold.
A wobble, then a good year
The 1997 buyer was tested within days. By Nov. 12, the $10,000 was worth $9,648.
That was as bad as it got. The investment dipped under $10,000 on a handful of days through early January, then pulled away.
A year after the purchase it was worth $11,830. That year included a sharp summer selloff when Russia defaulted on its debt, and the investment stayed above its starting value throughout it.
Most rebounds like this have held
The 1997 buyer's year was typical. We looked at every day since 1950 when the S&P 500 fell 4% or more and then won back at least half the loss within five trading days.
That happened 11 times before this month. A year after buying the rebound, investors were ahead in nine of them.
The ride was rarely smooth. Most of those buyers saw their investment fall more than 3% below its purchase price at some point during the year.
The rebound that did not hold
The clearest miss started on a Friday the 13th. On Oct. 13, 1989, a buyout of United Airlines' parent company fell apart and the S&P 500 dropped 6.1%.
A week later stocks had won back 62% of the loss. A buyer who put in $10,000 on Oct. 20 was ahead by December, and by the following July the stake was worth $10,628.
Then the ground shifted. Iraq invaded Kuwait on Aug. 2, 1990, and oil went from $21.59 a barrel the day before to $41.07 by Oct. 11.
That same day the investment hit its low of $8,511. It did not get back to $10,000 until February 1991, more than 15 months after the purchase.
The difference was the economy underneath. A recession began in July 1990, according to the National Bureau of Economic Research, which dates US business cycles. In 1998 the economy grew 4.5%, Commerce Department data show.
Which one is this?
Last week's crash had its own trigger. Investors feared that the Democratic sweep of Congress could slow the building of AI data centers, CNBC reported at the time.
The economy so far looks more like 1997's. It grew at a 3.4% annual rate in the third quarter, Commerce Department data show.
The pressures look more like 1990's. Brent crude, the global oil benchmark, rose 3.3% on Thursday to $95.82 a barrel as tensions with Iran grew, 24/7 Wall St. reported.
Prices are rising too. Wholesale prices were up 6.5% in October from a year earlier, the largest gain since November 2022, the Labor Department said on Friday.
Traders now expect the Federal Reserve to raise interest rates at its Dec. 9 meeting, CNBC reported. The 10-year Treasury yield closed Thursday at 5.10%.
Stocks were little changed early Friday. The S&P 500 was down 0.1% shortly before 10 a.m. Eastern Time, CNBC reported. Nvidia fell again after founder Jensen Huang resigned as chief executive on Thursday.
Explain the financial terms
A fiscal quarter is a three-month period in the company's reporting year.
What to watch
What separated 1997 from 1989 was whether a recession followed. Oil is the first thing to watch. It nearly doubled in ten weeks in 1990.
The Fed's decision on Dec. 9 is the second. Nvidia reports earnings on Tuesday under an interim chief, Yahoo Finance reported.
Both buyers came out well in the end. Without dividends, the 1989 purchase is worth about $218,700 today and the 1997 purchase about $80,857.
Past rebounds are not a forecast for this one, and none of this is advice to buy or sell.
How we did it
We used daily closing levels of the S&P 500 from Yahoo Finance, through Thursday, Nov. 12. Dollar figures follow the index and leave out dividends, which would have added to every result.
A rebound counts when the index falls 4% or more in a day, has no second 4% drop in the next five trading days, and ends those five days having recovered at least half the loss. Results run one calendar year from the fifth day. Friday's prices are early and not final.