The 6 May 2010 U.S. market plunge and rapid partial recovery was called the Flash Crash.
On May 6, 2010, major U.S. stock indexes fell sharply within minutes before recovering much of the loss. The Dow Jones Industrial Average temporarily dropped nearly 1,000 points, or about 9%, although it closed down 3.2%. Some individual securities briefly traded at extraordinarily low or high prices.
Investigations found that automated trading, market fragmentation, and a large sell order contributed to the event. The U.S. Securities and Exchange Commission and Commodity Futures Trading Commission concluded that a trader's use of an algorithm to sell a large number of E-mini S&P 500 futures contracts helped create intense pressure, while high-frequency trading firms amplified the movement.
The episode showed how quickly modern electronic markets can transmit stress. It also led to new safeguards, including single-stock circuit breakers and market-wide limit-up-limit-down mechanisms. It is distinct from a conventional crash that unfolds over days or months.