The 2010 U.S. market event in which the Dow plunged nearly 1,000 points before recovering was called the Flash Crash.
On May 6, 2010, major U.S. stock indexes fell rapidly within minutes. The Dow Jones Industrial Average lost about 1,000 points, roughly 9 percent, before recovering much of the decline. Individual securities experienced exceptionally extreme prices, including trades that were later canceled under exchange rules.
Investigations found that automated trading, market liquidity, and a large sell order interacted in a destabilizing way. A later U.S. Department of Justice case concluded that trader Navinder Singh Sarao used spoofing orders in E-mini S&P 500 futures and contributed to the event, although the crash reflected a wider market structure problem rather than one simple cause.
The episode led regulators and exchanges to strengthen circuit breakers, trading pauses, and monitoring systems. Unlike a traditional crash driven mainly by broad economic news, the Flash Crash demonstrated how computerized markets can move extraordinarily fast when liquidity suddenly disappears.