* Risk assets routed Britain votes to leave EU
* Sterling suffers historic fall in massive selloff, yen
jumps
* European shares down 7.5 pct, U.S. stock futures skid,
Asian shares follow
* US bond yields fall most since 2009, pressure builds for
Fed cut
* Oil and commodities battered, gold jumps 6 pct
By Marc Jones
LONDON, June 24 (Reuters) - World stocks headed for one the
biggest slumps on record on Friday as a decision by Britain to
leave the European Union triggered 8 percent falls for Europe's
biggest bourses and a record plunge for sterling.
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 all the major central banks.
Risk assets were scorched as investors fled to the
traditional safe-harbours of top-rated government debt, Japanese
yen and gold.
Billions were wiped from share values as Europe saw London's
FTSE .FTSE drop 6 percent in early deals, Germany's .DAX and
France's CAC 40 .FCHI slump 7.5 and 9 percent and Italian and
Spanish markets plunge more than 11 percent.
The rout was compounded by the fact markets had rallied on
Thursday having become increasingly convinced that UK voters
would opt to stay in the EU.
Britain's big banks took a $130 billion battering with
Lloyds LLOY.L and Barclays BARC.L plunging as much as 30
percent. EMINI S&P 500 futures ESc1 were down 4 percent and
Japan's Nikkei .N225 ended down 7.9 percent.
The British pound collapsed no less than 18 U.S. cents,
easily the biggest fall in living memory, to hit its lowest
since 1985. The euro in turn slid 3.2 percent to $1.1012 EUR=
as investors feared for its very future.
Having campaigned to keep the country in the EU, British
Prime Minister David Cameron confirmed he would step down.
Results showed a 51.9/48.1 percent split for leaving,
setting the UK on an uncertain path and dealing the largest
setback to European efforts to forge greater unity since World
War Two.
Sterling sank a staggering 10 percent at one point and was
last at $1.3582 GBP= , having carved out a range of $1.3228 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.
"It's an extraordinary move for financial markets and also
for democracy," said co-head of portfolio investments of
London-based currency specialist Millennium Global Richard
Benson.
"The market is pricing interest rate cuts from the big
central banks and we assume there will be a global liquidity add
from them in the next few hours," he added.
The shockwaves affected all asset classes and regions.
The safe-haven yen sprang higher to stand at 102.15 per
dollar JPY= , having been as low as 106.81 at one stage. The
dollar peak decline of 4 percent was the largest since 1998.
That prompted warnings from Japanese officials that
excessive forex moves were undesirable. Indeed, traders were
wary in case global central banks chose to step in to calm the
volatility.
The Bank of England said it would take all necessary steps
to shield Britain's economy. A source told Reuters it was in
touch with other major central banks. The Bank of Japan Governor
Haruhiko Kuroda added his bank was also ready to provide
liquidity if needed to ensure market stability.
Other currencies across Asia and in eastern Europe as it
woke up suffered badly on worries that alarmed investors could
pull funds out of emerging markets. Poland, where many of the
eastern Europeans in Britain come from, saw its zloty PLN=
slump 5 percent.
RECESSION FEARS
Europe's natural safety play, the 10-year German government
bond, surged to send its yields tumbling back into negative
territory and a new record low. EUR/GVD
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS slid almost 5 percent, while Shanghai stocks
.SSEC lost 1.1 percent.
Financial markets have been gripped for months by worries
about what Brexit, or a British exit from the European Union,
would mean for Europe's stability.
"Obviously, there will be a large spill-over effects across
all global economies if the "Leave" vote wins. Not only will the
UK go into recession, Europe will follow suit," was the gloomy
prediction of Matt Sherwood, head of investment strategy at fund
manager Perpetual in Sydney.
Investors duly stampeded to sovereign bonds, with U.S.
10-year Treasury futures TYc1 jumping over 2 points in an
extremely rare move for Asian hours.
Yields on the cash note US10YT=RR fell 24 basis points to
1.49 percent, the steepest one-day drop since 2009 and the
lowest yield since 2012.
As investors sought safer assets, the rally even extended to
UK bonds, despite ratings agency Standard and Poor's warning it
would likely downgrade the country's triple A rating if it left
the EU.
Yields on benchmark 10-year gilts fell 27 basis points to
1.108 pct GB10YT=TWEB .
Across the Atlantic, investors were pricing in even less
chance of another hike in U.S. interest rates given the Federal
Reserve had cited a British exit from the EU as one reason to be
cautious on tightening.
"It adds weight to the camp that the Fed would be on hold. A
July (hike) is definitely off the table," Mike Baele, managing
director with the private client reserve group at U.S. Bank in
Portland, Oregon.
Fed funds futures 0#FF: were even toying with the chance
that the next move could be a cut in U.S. rates.
Commodities likewise swung lower as a Brexit would be seen
as a major threat to global growth. U.S. crude CLc1 shed $3.00
to $47.11 a barrel in erratic trade while Brent LCOc1 fell as
much as 6 percent to $47.83 before clawing back to $48.18.
Industrial metal copper CMCU3 sank 3 percent but gold
XAU= galloped more than 6 percent higher thanks to its
perceived safe haven status. GOL/
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Brexit graphic package http://tmsnrt.rs/1Ke31HF
Britain and the EU http://tmsnrt.rs/28QKboK
Market reaction http://tmsnrt.rs/28QKdwV
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Editing by Toby Chopra)