The 2010 Flash Crash caused a sudden plunge and rapid rebound in U.S. stock prices.
On May 6, 2010, major U.S. equity indexes dropped sharply within minutes before recovering much of the loss. The Dow Jones Industrial Average briefly fell nearly 1,000 points, an extraordinary move for such a short period.
Investigations found that automated trading, high-frequency trading, and a large sell order interacted with already fragile market conditions. The event demonstrated how algorithms and fragmented trading venues could amplify a temporary imbalance between buyers and sellers.
The Flash Crash was not the same as the 2008 financial crisis or the 1987 Black Monday collapse. It was a brief, intraday market disruption rather than a prolonged, economy-wide crash. Regulators responded with measures including circuit breakers and controls intended to limit extreme price movements.