Sterling, stocks in free fall as UK nears EU exit

Carnage came to world markets on Friday as major television networks said Britain had voted to leave the European Union, sending sterling on a record plunge and pummelling share markets around the globe.

Such a body blow to global confidence could well prevent the Federal Reserve from raising interest rates as planned this year, and might even provoke a new round of emergency policy easing from the major central banks.

Risk assets were scorched as investors fled to the safety of top-rated government debt and gold. Billions were wiped from share values as FTSE futures fell 7 percent FFIc1, EMINI S&P 500 futures ESc1 4.4 percent and Japan's Nikkei .N225 7 percent.

The British pound had collapsed no less than 17 U.S. cents, easily the biggest fall in living memory, to hit its lowest since 1985. The euro in turn slid 3.4 percent to $1.0997 EUR= as investors feared for its very future.

Sterling sank a staggering 9 percent

While vote counting had not been concluded, major British television networks including ITV, the BBC and Sky News all called the result as a "Leave" and betting firm BetFair estimated the probability of leaving as high as 94 percent.

Sterling sank a staggering 9 percent to $1.3536 GBP=, having carved out a range of $1.3300 to $1.5022. The fall was even larger than during the global financial crisis and the currency was moving two or three cents in the blink of an eye.

"The carnage in the FX markets may continue if the leave votes pull further ahead in the lead," said Bernard Aw, markets strategist at IG in Singapore.

"Equities markets will be affected, and we can see that Asian stocks are already under a fair bit of pressure. British banks listed in Hong Kong are suffering significant losses."

HSBC (0005.HK) fell 9 percent while Standard Chartered (2888.HK) sank almost 10 percent.

The tremors shook all asset classes and regions.