The 2010 U.S. market event in which prices plunged and recovered within minutes was the Flash Crash.
On May 6, 2010, major U.S. stock indexes dropped rapidly before recovering much of the loss. Individual securities experienced extreme and sometimes nonsensical price movements, including some trades executed at fractions of a cent or at unusually high prices.
Investigations found that automated trading and a large sell order interacted with already fragile market conditions. Regulators later charged trader Navinder Singh Sarao with contributing to the event through spoofing, although the broader episode involved complex interactions among algorithms, liquidity, and market structure.
The Flash Crash was different from a traditional multi-day bear market. It was exceptionally sudden and short-lived. New rules, including improved circuit breakers and trading pauses, were introduced or strengthened afterward to reduce the chance that similar feedback loops would spread unchecked.