U.K. business leaders reacted with alarm to Prime Minister Theresa May's plan to leave the European Union's single market, saying it clouds the future of Britain's most important trading relationship.

May said she will sacrifice membership of the EU's tariff-free zone in return for the ability to curb immigration and assert Britain's sovereignty. In a speech Tuesday, she said she'd try to smooth the exit by applying European rules until new laws are approved while seeking a free-trade agreement with the EU and a "phased" implementation of the new rules.

"Today the prime minister changed the landscape," Carolyn Fairbairn, director-general of the Confederation of British Industry lobby group, said in a statement. "Ruling out membership of the single market has reduced options for maintaining a barrier-free trading relationship between the U.K. and the EU."