SYDNEY—Asia share markets are bracing for more uncertainty amid ongoing fallout from the U.K.'s decision Friday to depart the European Union.

On Friday, the Dow Jones Industrial Average dropped 610.32 points, or 3.39%, to 17400.75, wiping out its year-to-date gains as Britons voted to walk away from the EU, a move that has already had massive political repercussions, with U.K. Prime Minister David Cameron announcing he will resign.

On Friday, the S&P 500 index fell 3.59%, dragged lower by bank stocks, and the tech-heavy Nasdaq Composite shed 4.12%. Australia was one of several markets to see billions of dollars of value wiped out on Friday, with the S&P/ASX 200 losing 3.2%, to 5113.2.

The world's top central bankers will be a key focus in the day ahead as they gather at a three-day European Central Bank summit in Sintra, Portugal. Janet Yellen of the Federal Reserve, Mark Carney of the Bank of England and Mario Draghi of the European Central Bank are among the central bank leaders scheduled to speak.

Grant Williamson, a New Zealand-based investment adviser at Hamilton Hindin Greene, expects markets to be in for another decline.

"There is obviously going to be a continuation of a selloff this morning on the New Zealand market in reaction to Wall Street and European markets, which did get hit pretty hard on Friday," Mr. Williamson said. "I think volatility is going to be the word of the week."

However, Matt Felsman, a private wealth adviser at APP Securities, said investors need to put Friday's falls in perspective. Mr. Felsman said he expects trading to remain choppy on Monday, adding he believes "cooler heads will prevail" in upcoming trading sessions.

"We were very lucky to have the weekend to digest, most press is now suggesting Friday's plunge is creating a buying opportunity," Mr. Felsman said.

Currency markets are set to remain volatile with attention focused on the yen in Asia after the haven currency rallied to its highest levels since November 2013 on Friday.

The sharp gain in the yen have prompted speculation Japanese authorities will launch market intervention to contain the currency's gains.

A senior Japanese ruling-party lawmaker issued a stern warning Sunday about the soaring yen, saying the government shouldn't hesitate to undertake direct intervention in the currency market if that is deemed necessary.

"Sharp, speculation-driven movement has a very bad impact," Tomomi Inada, policy chief of the ruling Liberal Democratic Party, said during a program on Japan's national broadcaster NHK. "We shouldn't hesitate to undertake countermeasures if necessary, including intervention."

Emerging-market currencies were among the hardest hit by Friday's market rout. The U.S. dollar jumped 4.5% against the South African rand, 3.8% against the Mexican peso, and 3.7% against the Hungarian forint.

More broadly, economist are warning Brexit will unleash fresh concerns about disinflation in the world economy and heighten growth risks.

Morgan Stanley said it now has a target for Australia's benchmark S&P/ASX200 of 4,800, down from its close on Friday above 5,100, citing a "risk-off shock and heightened awareness of deflationary and growth risk."

"Our U.K .economists see the U.K. referendum decision leading to protracted political and economic uncertainty, which will weigh on growth over the next two years," said Chris Nicol, strategist at Morgan Stanley.

Write to James Glynn at james.glynn@wsj.com and Kate Geenty at kate.geenty@wsj.com

 

(END) Dow Jones Newswires

June 26, 2016 20:55 ET (00:55 GMT)

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