The 2010 U.S. stock-market plunge that erased nearly $1 trillion in minutes is known as the Flash Crash. On May 6, 2010, major U.S. equity indexes dropped sharply before recovering much of the loss by the end of the trading session.
The Dow Jones Industrial Average fell about 1,000 points, or roughly 9%, during the episode. Individual securities experienced even more extreme temporary price movements, including trades at implausibly low or high prices.
Investigations linked the event to a combination of high-frequency trading, automated orders, market fragmentation, and a large sell order in E-mini S&P 500 futures. A later U.S. Justice Department case also involved trader Navinder Singh Sarao, whose spoofing activity was found to have contributed to market pressure, though the event had multiple causes.
The Flash Crash differed from a conventional prolonged bear market. It unfolded over roughly 36 minutes and led exchanges and regulators to strengthen safeguards, including circuit breakers and limits on clearly erroneous trades.