Not enough ... Pier Luigi Bersani. Photo: Reuters
ROME: Italy's centre-left leader, Pier Luigi Bersani, has admitted he had ''come first but not won'' in national elections and asked parties to help him push through reforms amid a political deadlock that sent markets tumbling.
Mr Bersani warned that the huge anti-austerity protest vote that left the Italian parliament at an impasse was a warning for leaders across the continent.
''The bell tolls also for Europe,'' he said in his first speech since the vote. ''We are aware of the risks that Italy faces.''
Final results showed his coalition had won the lower house but no party had taken the upper house. Commentators fear a return to political instability in Italy could send shock waves across a euro area still struggling with a debt crisis.
Stocks plunged and Italy's borrowing rates jumped, as analysts warned the eurozone's third biggest economy could face fresh elections within months.
A majority in both chambers of parliament is required to form a government. Mr Bersani called for an agreement with other parties on basic reforms - cutting government costs, reforming the labour market and helping Italy's poorest as the country endures its longest recession in two decades.
Analysts said this could be seen as a possible opening to the Five Star Movement (M5S) led by the comedian turned anti-corruption firebrand Beppe Grillo, which won dozens of seats in both houses.
Under the constitution, the parliament has to meet within 20 days of an election, after which formal negotiations begin with the Italian President, Giorgio Napolitano, on forming a new government.
European capitals were quick to voice concern. ''It's a leap into the unknown, which bodes poorly both for Italy and for the rest of Europe,'' the Spanish Foreign Minister, Jose Manuel Garcia Margallo, said.
The European Commission said it heard ''the message of concern'' from voters but expected Italy to stick to its pledged budget cuts and economic reforms.
A coalition led by Silvio Berlusconi defied all poll predictions by coming in a close second in the vote for the lower house, winning 29.18 per cent to Mr Bersani's 29.54 per cent.
The anti-government M5S reaped a resounding protest vote from an electorate fed up with austerity and recession to score 25.5 per cent in the lower house.
''We're not against the world,'' Mr Grillo said on Tuesday. ''We'll see reform by reform, law by law. If there are proposals that are compatible with our program, we will evaluate them.''
In a blog post, he said: ''The M5S is not allying with anyone.''