The official name of the 6 May 2010 U.S. market plunge commonly called the Flash Crash is 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 about 1,000 points, or nearly 9 percent, before rebounding. Individual securities also traded at extremely unusual prices during the turmoil.
Investigations by U.S. regulators concluded that a large automated sell order in E-mini S&P 500 futures helped trigger a feedback loop involving high-frequency traders and rapidly changing liquidity. The event demonstrated how electronic markets could amplify short-term pressure.
The Flash Crash was not the same as a prolonged bear market such as the 2008 crisis. Later reviews and court proceedings examined the actions of trader Navinder Singh Sarao, whose spoofing activity was linked to the episode, although the crash resulted from interacting market conditions rather than one simple cause.