The UK's referendum vote to leave the EU sent markets into a tailspin early on Friday.

London's FTSE 100 opened 560 points lower at 5780, having fallen back sharply overnight but the UK's top share index recovered slightly in afternoon trading.

The Brexit camp claimed a historic victory which has already led to the resignation of UK prime minister David Cameron.

Sterling was trading around 7% lower against the dollar early on. Gold made a 2 ½ year high. Crude prices are bouncing.

Germany's Dax slumped 7%, France's CAC fell 8% and the FTSE 250 index plunged 11% after the open and was down 7% ahead of the close. 

“The world’s currencies, equities and bonds are now on magical mystery tour - at least in the short-term," said Nigel Green, chief executive of deVere Group.

The ECB and the Bank of England have already made it known that they would increase their cooperation to guarantee the banks access to liquidity in both currencies.

In case of very significant turbulence, coordinated interventions with other major central banks, including the Fed, are likely.

Analysts around the globe are now predicting what the decision means for the economy and asset classes in the short, medium and long-term.

“Investors around the world on Friday will pile into safety and prompt a significant shift in global markets from risky assets to safe havens,” added Nigel Green.

“The FTSE will tumble, the pound is already in freefall, and investors will be gearing up for probable shifts in the Swiss Franc, to the price of gold, and to monetary policies globally.” 

Green added that there is likely to be two years of varying degrees of market volatility because of the plethora of unknowns. At this stage there are still question marks hanging over so many different areas.

The Investment Association, a trade body representing UK asset managers, said it remains confident that the industry will be able to continue to compete overseas, both in the EU and the rest of the world.  

Investment experts at Europe’s largest asset manager Amundi said in the very short-term, we are looking at a weakening of the pound and a fall in stock markets. 

“By contagion, the sovereign bond yields of peripheral Eurozone countries should increase and liquidity should worsen significantly on the credit market, in both the UK and the Eurozone.

“In this case yields on safer government bonds (Germany, US) are declining and gold is gaining ground (flight to quality).The Euro has weakened given doubts about the cohesion of the European Union.” 

Marie-Owens Thomsen, chief economist at Indosuez Wealth Management - Credit Agricole’s private banking arm - said vote to leave the EU is the start, not the end, of a process that could take up to a decade or more.

“In addition to the detrimental effects of prolonged uncertainty and the opportunity cost of spending time and money on these negotiations instead of more pro-growth policies, one can expect the UK financial industry, car manufacturers, and farmers to be particularly hurt, at least until a new framework emerges for the UK, in 2019 at best. 

Carolyn Fairbairn, CBI director-deneral, added: “The British people’s vote to leave the EU is a momentous turning point in our history. The country has spoken and it’s for us all to listen.

“Many businesses will be concerned and need time to assess the implications. But they are used to dealing with challenge and change and we should be confident they will adapt.

“The urgent priority now is to reassure the markets. We need strong and calm leadership from the Government, working with the Bank of England, to shore up confidence and stability in the economy.

“The choices we make over the coming months will affect generations to come. This is not a time for rushed decisions."