The Capital has been hit by a series of terrorist attacks on its transport network at the height of the morning rush hour.
At least 33 people were killed and around 1,000 were injured in the explosions in central London.
Three bombs exploded on Tube trains between 8.51am and 9.47am, while a blast also occurred on a number 30 bus.
The initial incident on a train leaving Liverpool Street station was blamed on a power surge but following the three other explosions it became clear London was being targeted by terror attacks, a day after the start of the G8 summit in Gleneagles.
Following the blasts, shares on the London Stock Exchange (LSE) plummeted.
The FTSE 100 index fell 2.19% to 5,115 and markets around the world saw similar drops as investors woke to news of the bombings.
Several City buildings were evacuated, including the London Clearing House, but most financial services firms advised staff to stay put and not make any unnecessary journeys.
Market reaction was immediate, but analysts said they expect the economic impacts to be "minimal and brief."
"What you're seeing is a flight to safety," Anais Faraj, equities strategist at Nomura, told the BBC.
Financial markets traders reacted quickly by selling shares in firms likely to be affected by the blasts, such as insurance companies and travel agents.
Analysts agreed the economic effects may take some time to fully emerge, but in the end they should not be too severe.
