The May 6, 2010 U.S. market plunge was known as the Flash Crash.
On that afternoon, major U.S. equity indexes fell rapidly and then recovered much of the loss within minutes. The Dow Jones Industrial Average briefly dropped nearly 1,000 points, while prices in some individual securities moved to extreme levels before stabilizing.
Investigations found that automated and high-frequency trading interacted with a large sell order and stressed market conditions. The event was not caused by a single simple computer error; rather, several market mechanisms and trading behaviors amplified the move. A later U.S. investigation charged trader Navinder Singh Sarao in connection with spoofing, although the broader event involved many participants and systems.
The Flash Crash led regulators and exchanges to strengthen circuit breakers, market-wide halts, and controls for clearly erroneous trades. It is distinct from a conventional multi-day bear market because its defining feature was the extraordinary speed of the decline and partial rebound.