The Australian share market has dropped more than three per cent, wiping out $56 billion in value, as worried investors considered the economic fallout after Britain voted to leave the European Union.
The local market booked its biggest one-day fall in nine months as Britain voted by a narrow margin to leave the EU after 43 years in a historic referendum.
Australia was always going to be a "forward scalp" as the stock market was trading as referendum results started to filter through, Patersons Securities economist Tony Farnham said.
"The bottom line is we're the ones that are trading at this time so we get to be the first opportunity for markets to react, for global investors to react," Mr Farnham said.
"And then we focus on the true picture tonight when European and US markets fire up because by then the result will be signed off on."
The Brexit raises many possible scenarios and investors don't like uncertainty, said Mr Farnham.
"There's quite a few unknowns, what will the UK Parliament think of this, will they try and reverse it in some way," he said.
The benchmark S&P/ASX 200 - which opened nearly one per cent higher as early votes started to trickle through - closed 3.17 per cent lower, with all sectors in the red.
Australia's financial stocks felt the brunt of the sell-off, with resource giants also coming under pressure.
Investment bank Macquarie Group dropped $5.38 to $71.20, the Commonwealth Bank fell $2.45 to $72.57, Westpac lost $1.31 to $28.34, National Australia Bank lost 97 cents to $24.61 and ANZ fell $1.00 to $23.44.
UK and Australian-listed fund manager Henderson Group was slammed 12 per cent, losing 61 cents to $4.46.
Mining giant Rio Tinto dropped $2.97 to $42.83, while BHP Billiton fell $1.51 cents to $17.54.
Oil and gas producer Woodside Petroleum fell 83 cents to $25.77.
The only bright spot on the market was the gold sector as investors sought out a safe haven, Mr Farnham said.
Newcrest Mining jumped $1.91 to $23.55 and OceanaGold gained 44 cents to $5.09.
* At 1619 AEST on Friday, the benchmark S&P/ASX 200 index was down 167.4 points, or 3.17 per cent, at 5,113.2 points.
* The broader All Ordinaries index was down 165.8 points, or 3.09 per cent, at 5,192.8 points.
* The September share price index futures contract was down 165 points at 5,069 points, with 69,169 contracts traded.
* National turnover was 4.29 billion securities traded, worth $10.35 billion, based on preliminary figures.