REUTERS
The London stock market has plunged more than 8% in the wake of the UK's vote to leave the EU.
In the opening minutes of trade, the FTSE 100 index fell more than 500 points before regaining some ground.
Banks were especially hard hit, with Barclays and RBS falling about 30%.
Earlier, the value of the pound fell dramatically as the referendum outcome emerged. At one stage, it hit $1.3236, a fall of more than 10% and a low not seen since 1985.
The Bank of England said it was "monitoring developments closely" and would take "all necessary steps" to support monetary stability.
"This is simply unprecedented, the pound has fallen off a cliff and the FTSE is now following suit," said Dennis de Jong, managing director of UFX.com.
"Britain's EU referendum has been a cloud hanging over the global economy for the past few months and that cloud has got very dark this morning.
"The markets despise uncertainty, yet that is exactly what they're faced with this morning. The shockwaves are likely to reverberate for some time and the warning lights are flashing brighter now than ever."
The FTSE's slump was its biggest one-day fall since the collapse of Lehman Brothers in October 2008.
ETX CAPITAL
As well as the banks, the housebuilding sector was also badly hit, with shares in Bovis Homes down more than 50%.
UK government bond yields hit a new record low, with 10-year yields down more than 30 basis points to 1.018%, according to Reuters data.
Two-year yields fell more than 20 basis points to their lowest levels since mid-2013, at 0.233%.
The impact of the vote was also felt in other European countries. The Paris and Frankfurt indexes were both down about 8%, while the Swiss central bank intervened on the money markets to steady the Swiss franc after it appreciated in value.
Oil prices have also fallen sharply in the wake of the referendum outcome, with Brent crude down 5.2%.
The price of Brent crude fell by $2.68 to $48.24 a barrel, its biggest fall since February. At the same time, US crude was down 5.4%, or $2.69, to $47.52 a barrel.
The price of gold jumped nearly 7% to $1,348.27 an ounce.
'Once-in-a-lifetime moves'
Before the results started to come in, the pound had risen as high as $1.50, as traders bet on a Remain victory.
But following early strong Leave votes in north-east England, it tumbled to $1.43 and then took another dive after 03:00 BST as Leave maintained its lead.
The move in sterling is the biggest one-day fall ever seen.
A weaker pound buys fewer dollars or other foreign currencies, which makes it more expensive to buy products from abroad. However, it should benefit exporters as it makes their goods cheaper abroad.
Against the euro, the pound dropped 7% to about €1.2085.
The euro also fell 3.3% against the dollar, its biggest one-day fall since the currency's inception
Currency traders say these moves are more extreme than those seen during the financial crisis of 2008.
"Leave's victory has delivered one of the biggest market shocks of all time," said Joe Rundle, head of trading at ETX Capital.
"The pound has collapsed to its lowest level in over 30 years, suffering its biggest one-day fall in living memory.
"Panic may not be too strong a word - the pound could have further to go over the next couple of days as markets digest the news.
"It's fair to say we've never seen anything like it and the chances are markets will remain highly volatile over the coming hours and days."
'Contingency plans'
David Tinsley at UBS said there would be "a significant rise in economic uncertainty" and that the Bank of England's Monetary Policy Committee (MPC) was expected to take action, including interest rate cuts and an extension of its quantitative easing programme.
"We expect the MPC will cut policy rates to zero and make further asset purchases, in the first instance of £50-75bn, not later than February 2017," he said.
In a statement, Bank of England governor Mark Carney said the Bank would "pursue relentlessly" its responsibilities for monetary and financial stability, which were unchanged.
He said the Bank had put in place "extensive contingency plans" to mitigate the risks associated with the referendum, adding that it stood ready to provide more than £250bn of additional funds to banks through its normal facilities.
"In the coming weeks, the Bank will assess economic conditions and will consider any additional policy responses," he said.
Top four pound moves post-World War Two
GETTY IMAGES- 1971 Pound moves 3.4% after Nixon Shock -- cancellation of the direct international convertibility of the United States dollar to gold.
- 1 November 1978 4.3% "Winter of discontent" shakes global investors confidence in UK's economy.
- 16 September 1992 4.29% when the UK exited the exchange rate mechanism.
- 20 Jan 2009 Pound slides 3.9% at the peak of the financial crisis following the demise of Lehman Brothers.
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