The 2010 Flash Crash caused a dramatic temporary plunge in U.S. stocks on May 6, 2010.
That afternoon, major U.S. indexes suddenly dropped and then recovered much of the loss within minutes. The Dow Jones Industrial Average briefly fell by nearly 1,000 points, an unusually large movement for such a short period. Individual securities also recorded extreme, short-lived prices.
Investigations concluded that automated trading played a central role. A large sell order in E-mini S&P 500 futures interacted with high-frequency trading and strained market liquidity. The U.S. Securities and Exchange Commission and Commodity Futures Trading Commission later described the event as involving a rapid feedback loop in electronic markets.
The crash encouraged new safeguards, including coordinated trading pauses and tighter controls on clearly erroneous transactions. It was different from a conventional multi-day bear market because much of the plunge reversed almost immediately.