Brexit vote shockwaves rock global markets

Media gather in Downing Street, London, after Britain voted to leave the European Union in an historic referendum which has thrown Westminster politics into disarray and sent the pound tumbling on the world markets. Photo: PA
Media gather in Downing Street, London, after Britain voted to leave the European Union in an historic referendum which has thrown Westminster politics into disarray and sent the pound tumbling on the world markets. Photo: PA
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World financial markets have been rocked by the UK's vote to leave the European Union, with stock markets and oil prices crashing and the pound hitting its lowest level in three decades.

The uncharted, unexpected path of a European Union without the UK sparked the sell-offs, with further jitters expected as global markets try to digest the shock result.

Tokyo stocks plummeted about 8%, their biggest fall since 2008, while South Korea's Kospi tumbled about 3%. Britain's FTSE 100 futures tanked 8.3%.

Crude oil prices and US futures also took a big hit. The pound plummeted more than 10% in six hours while the yen surged about 3% to the US dollar as investors seeking safety snapped up the Japanese currency.

By early afternoon in Asia, a tally by the BBC showed Britain had voted to leave the 28-nation European Union by about a 52% to 48% margin.

Japan's Nikkei 225 plunged 8.3% to 14,897.32 while South Korea's Kospi sank 3.4% to 1,918.70. Hong Kong's Hang Seng index tumbled 4.8% to 19,866.20 and Australia's S&P/ASX 200 fell 3.4% to 5,012.20. Stocks in Shanghai, Taiwan, Sydney and south-east Asian countries were sharply lower.

US futures took a dive, with Dow futures down 3.4% and S&P futures nosediving 5%.

"Financial markets throughout the night have been chaotic to say the least, and this may continue as the day progresses," said Craig Erlam, senior market analyst at Oanda in London.

"All eyes will now be on central banks around the world to see how they respond to these market developments, particularly the Bank of England and the Bank of Japan."

On Thursday, Wall Street finished with rallies as pre-poll forecasts showed that Britain would keep the EU membership.

Asian stock markets opened the day higher but the mood turned sour as results started to show that Leave vote would win. As the results increasingly pointed to the EU exit, investors dumped stocks and other risky assets.

The results sent the pound on a wild ride. It rose to its highest point for the year of 1.50 dollars before tumbling more than 10% to a low of 1.3303 dollars, its lowest level since 1985.

Benchmark US crude plummeted 6.4%, or 3.17 dollars, to 46.94 dollars per barrel in New York. Brent Crude, the benchmark for international oil price, fell 6.1%, or 3.11 dollars, to 47.80 dollars per barrel in London.