On May 6, 2010 the United States stock market crashed and the Dow Jones Industrial Average plunged about 1000
points (about 9%) only to recover those losses within minutes. This "flash crash" was
the second largest point swing, 1,010.14 points, and the biggest one-day
point decline, 998.5 points, on an intraday basis in Dow Jones
Industrial Average history.
A flash crash refers to a quick drop and recovery in securities prices, for example, "There was a massive flash crash in India's NFY 50 Index this morning." What causes these crashes? The SEC is unable to provide a specific answer but rather points either a "large fundamental trader" or HFTs (High Frequency Traders) as part of the reason the markets flash crashed.