What event caused the Dow Jones to lose nearly 1,000 points in minutes on 6 May 2010?

The 2010 Flash Crash caused the Dow Jones Industrial Average to lose nearly 1,000 points in minutes on 6 May 2010.

During the afternoon session, major U.S. equity indexes plunged rapidly before recovering much of the loss. The Dow’s decline was approximately 998.5 points, or about 9 percent, making it one of the most dramatic intraday market disruptions ever recorded.

Investigations linked the event to a combination of market stress, high-frequency trading, and a large automated sell order. Liquidity disappeared in parts of the market, allowing prices to move far more violently than normal.

The episode was not a traditional multi-month bear market. It was a sudden market-structure failure, and some trades were later canceled as clearly erroneous. U.S. regulators subsequently strengthened safeguards, including single-stock trading pauses and market-wide circuit breakers.