The 2010 Flash Crash caused a dramatic intraday U.S. stock-market plunge on May 6, 2010.
During the afternoon of May 6, major U.S. indexes fell rapidly and then recovered much of the loss within minutes. The Dow Jones Industrial Average briefly dropped by about 1,000 points, roughly 9%, before rebounding. Some individual securities traded at extraordinarily low or high prices during the turmoil.
Investigations by U.S. regulators concluded that a large automated sell order, combined with stressed market conditions and high-frequency trading, helped produce the extreme movement. The event exposed how interconnected electronic markets had become and how quickly automated systems could amplify a disturbance.
The Flash Crash was not a conventional, multi-year bear market like the crashes of 1929 or 2008. It was primarily a short-lived market-structure event. Regulators subsequently introduced safeguards including circuit breakers and rules intended to address clearly erroneous trades and extreme volatility.