Britain's decision to leave the European Union has wiped more than £50 billion off London's top flight index and sent markets into meltdown across the globe.

The FTSE 100 Index closed down 3.15%, falling 199.41 points to 6138.69, as it recovered from a 7% plunge earlier in the session when David Cameron announced he would quit as Prime Minister by October following the Brexit vote.

Sterling began to creep back from its 10% fall and 31-year low in the early hours of Friday morning, as it dropped 8.9% against the dollar at 1.365 US dollars.

London's top flight index had lost more than £100 billion earlier in the session, while world markets descended into chaos as uncertainty spread across the globe.

But the London market regained some poise - finishing higher at the end of the week than at the start - after the Bank of England pledged to intervene to help shore up the markets.

Governor Mark Carney said the Bank is prepared to provide £250 billion to support the markets, but added that "some market and economic volatility can be expected as this process unfolds".

Germany's Dax was 6.8% off and the Cac 40 in France was down 7.9% as both markets pulled back from 9% falls in earlier trading.

The US Dow Jones Industrial Average opened 2.8% lower, before paring back to a drop of 2.5% as the FTSE 100 closed.

The US central bank has said it is ready to take steps to ease the pressure on global markets following Britain's decision to leave the EU.

The Federal Reserve said it was "carefully monitoring developments" and would pump extra money into global financial markets to soften the blow on the US economy if needed.

The price of oil also took a tumble, dropping 4.1% or 2.11 dollars to 48.80 US dollars (£35.70) a barrel in the wake of the Brexit decision.

The London market resembled a sea of red, with heavy-weight financial stocks and travel firms falling sharply.

However, it was the housebuilders which bore the brunt of the slump, with Taylor Wimpey standing at the top of the biggest fallers, off more than 29% or 56.3p at 136.1p.

Charles Church-owner Persimmon was down 27% or 578p to 1520p, while Barratt Developments slid just shy of 24% or 137.7p to 439.8p.

Liberum analyst Charlie Campbell said: "The debate over what the EU referendum means for the outlook for the UK will last much longer than today, but for now we offer the conclusion that the outcome is bad for housebuilders' shares as the combination of slowing GDP, rising longer term rates and political uncertainty is like Kryptonite for that group of shares."

Lloyds Banking Group took a hefty hit, down 21% or 15.2p to 57p, while Barclays dropped 17% or 33.1p to 153.9p.

Among the travel firms under pressure, British Airways-owner IAG was more than 22% down, falling 119p to 409p as it warned over profits following Brexit.

The airline firm said "it no longer expects to generate an absolute operating profit increase similar to 2015" following the outcome of the referendum.

Meanwhile, budget carrier easyJet announced it was "working on a number of options to allow it to continue flying in all of its markets".

Shares were off 14% or 220p at 1313p.

In retail stocks, Marks & Spencer fell close to 11% or 39.9p at 326.4p, while Next slid 12% or 687p to 4848p.

However, safe haven stocks were soaring as gold rallied to a two-year high at 1358 US dollars, before paring back to 1318.4.

Gold miner Rangold Resources was the biggest riser, up more than 14% or 915p to 7370p, while silver miner Fresnillo climbed around 11% or 147p to 1386p, as investors ran for cover following the market fall.

However, drugs giant GlaxoSmithKline was on the up as it moved to calm investor concerns that it would be dealt a financial blow by Brexit.

Shares rose 53p to 1,482p as the company stated: "We do not currently anticipate a material adverse impact on the business."

Rolls-Royce shares were also faring better than the wider market, as it stated that two-thirds of its revenue and three quarters of its order book came from outside of the EU.

The company said "the UK's decision will have no immediate impact on our day-to-day business", helping shares to climb 4.5p to 649p.