BRITAIN’S exit from the European Union has sent shock waves through the Australian share market, wiping about $70 billion from the ASX.

Several world leaders have warned that a British exit, or Brexit, of the EU would lead to a recession with global spillover effects.

Financial markets across the world went into free fall as results of the EU referendum came in.

The pound collapsed to a 31-year low and currency, equity and oil markets went into free fall Friday as projections showed Britain voted to leave the EU.

Australia’s benchmark S&P/ASX 200 sank almost four per cent on the news, falling 200.4 points, to 5,080.3 at about 3.45pm, joining the sea of red across Asian markets. It managed to regain 123 points, or about $20 million, by the close of trade at 4pm. The benchmark index now sits at its lowest point since April.

“Our financial markets, not just stocks but also the dollar and bond markets, are forward scouts for this particular event,” Patersons Securities’ economist and market strategist Tony Farnham told AFP earlier on Friday.

“So our markets are reacting to the ebb and flow on whether you believe they are going to ‘leave’ or ‘remain’ in the EU. International markets would be showing concern about the uncertain economic ramifications were the UK to vote to leave the EU.”

All market sectors across the S&P/ASX 200 were weaker, with mining stocks making up the bulk of the top 10 losers about midday.

“Anyone that has got a bit of gold ... gold is a bit of a safe haven,” Morgans’ stockbroking client adviser Steve Greentree told AFP.

“(There’s a) few little pockets of resistance but predominantly it is coming off. But anyone that’s got a bit of US dollar exposure or North American exposure might outperform a little bit.”

WARNING BELL SOUNDED

In the weeks leading up to the historic vote, there had been widespread warnings that a vote to leave would cause another rout across global markets that would wipe trillions off valuations, just months after a painful China-fuelled sell-off.

And as results came in, the doomsday scenario began to unfold as the BBC and other broadcasters called a win for “leave”.

Australian Treasurer Scott Morrison said despite financial market volatility over the Brexit vote, the way in which Britons vote “doesn’t change anything that the Australian government has to do” in terms of the nation’s economic plans.

“Undoubtedly there is volatility in markets and currencies that sit around these events. But that is not necessarily determinative of long-term volatility,” Morrison told reporters in Sydney.

“The implications for Australia are minimal, potentially. But there are other decisions that may flow from this (from) which will arise different challenges.”

AUSTRALIAN DOLLAR HIT

The Australian dollar has plummeted against the US dollar and soared against the pound after the Brexit vote.

At 5pm on AEST on Friday, the currency was trading at 73.61 US cents, down from 75.26 US cents on Thursday, and at 54.01 British pence, up from 51.06 pence.

Investors had ditched the pound for the greenback en-masse, Commonwealth Bank chief currency strategist Richard Grace said.

Plunging Asian equity markets and commodity prices added to the broader risk-off movement, he said, warning the Australian dollar was still facing downside risks because of the large falls set to occur on the world’s major share markets, as a lot of local asset managers are over-hedged on their offshore asset exposure.

“They will be forced to sell Aussie until month-end to balance the hedge ratios,” Mr Grace said.

“I think we’ll see it go down further.” However, CBA is still forecasting the Australian dollar will sit at 73 US cents by the end of 2016.

Sterling crashed more than nine per cent to $1.3305 in the aftermath — its weakest level since 1985 — while the greenback slumped below 100 yen for the first time in two-and-a-half years as traders fled to safety.

CURRENCIES IN FREEFALL

Earlier, the British pound fell to its lowest level since January 2009, just hours after hitting its highest level for the year moments after the polls closed.

The pound had topped $1.50 following predictions the “remain” group would win but as the Brexit camp posted victories around the country, traders stampeded to put in sell orders.

The US dollar slumped briefly to 99.02 yen, the first time it has gone below 100 yen since November 2013, before edging back up slightly. The Japanese unit is considered a safe bet in times of uncertainty and turmoil.

Tokyo stocks went into a hair-raising dive on Brexit fears, plunging more than six per cent Friday afternoon as major firms’ shares including Toyota and mobile carrier SoftBank went into free fall.

The benchmark Nikkei 225 index at the Tokyo Stock Exchange dropped 6.39 per cent, or 1,037.79 points, to 15,200.56, while the broader Topix index of all first-section shares shed 6.37 per cent, or 82.79 points, to 1,215.92.

A flight to safety also saw higher-yielding and emerging market currencies slump, with the Australian dollar down 3.2 per cent, South Korea’s won diving 2.4 per cent, Malaysia’s ringgit down 2.3 per cent and the Indonesian rupiah shedding 1.7 per cent. There were also heavy losses for India’s rupee, the Canadian dollar and the Singapore dollar.

BREXIT SHOCK

The outcome has upturned expectations, which had been for a tight race narrowly won by the “remain”, while bookmakers had said there was a 90 per cent chance of staying in.

But as the shock results rolled in, equity markets went into meltdown. Tokyo plunged more than eight per cent in the afternoon, Sydney shed 3.7 per cent and Seoul was 3.5 per cent off. Mumbai lost three per cent and Shanghai sank 1.4 per cent by lunch, while Taipei, Wellington, Manila and Jakarta all saw sharp losses.

Hong Kong tumbled 4.7 per cent by the break with British banking giants HSBC and Standard Chartered both plunging more than 10 per cent.

In the early hours in Britain, Nigel Farage, leader of the anti-Europe UK Independence Party, declared victory, saying it was the country’s “independence day”.

The prospect of a severe hit to the global economy also hammered oil prices, with both main contracts slumping more than six per cent.

“We are seeing oil swept up in the general market nervousness to the vote,” Ric Spooner, a chief analyst at CMC Markets in Sydney, told Bloomberg News.

“Corrections are likely to be fairly shallow in oil because prices will be supported by the fact a balanced market is firmly on the horizon.”

World oil prices plunged more than 5.0 per cent in Asia, while US benchmark West Texas Intermediate for delivery in August was down $2.52, or 5.03 per cent at $47.59 at about 3.30pm. Brent crude for August was down $2.52, or 4.95 per cent, at $48.39.

Key figures at about 4pm

Pound/dollar: DOWN at $1.3305 from $1.4974 late on Thursday

Euro/dollar: DOWN at $1.1030 from $1.1422

Dollar/yen: DOWN at 101.01 yen from 106.53 yen

Nikkei 225: DOWN 8.3 per cent at 14,890.56

Shanghai Composite: DOWN 1.2 per cent at 2,857.58 (break)

Hang Seng: DOWN 4.7 per cent at 19894.12 (break)

DOW: UP 1.3 per cent at 18,011.07 (close)

FTSE 100: UP 1.2 per cent at 6,338.10