The 2010 U.S. market event in which stocks briefly plunged and rapidly recovered was the Flash Crash.
On May 6, 2010, U.S. equity markets experienced an exceptionally rapid decline followed by a partial rebound. The Dow Jones Industrial Average dropped about 1,000 points, or roughly 9%, within minutes before recovering much of the loss.
Investigations linked the episode to interactions among high-frequency trading, automated orders, market liquidity, and a large sell order. Some individual securities briefly traded at extremely low or high prices, creating visible distortions across markets.
The Flash Crash differed from a conventional bear market because its most dramatic movement happened in minutes rather than over months or years. Regulators later strengthened safeguards, including market-wide circuit breakers and mechanisms intended to cancel clearly erroneous trades.