What Happened to the S&P 500 When Mexico Defaulted in 1982?

U.S. banks held over 50% of  Mexico’s debt during the Latin American Debt Crisis. Their exposure caused panic in the capital markets and the S&P 500 began to tumble in late 1980. After a 25% fall from its highs, the market capitulated in August 1982 when Mexico’s Finance Minister announced default. The IMF intervened and the S&P 500 rallied hard for two years.

~FIN