Lack of a clear winner in Spain's snap election could lead to a prolonged period of uncertainty on the stock market
The center-right People's Party (PP) won Sunday's snap general election in Spain, winning 136 seats in the 350-seat parliament. PP leader Alberto Nunez Feijoo announced his readiness to form a new government and called on the other parties to help him with this mission. On the other hand, polls from just a few weeks ago gave him a decidedly higher number of seats, which can be considered a slight disappointment for the PP party that was predicted to form a new government.
Second place went to the leftist Spanish Socialist Workers' Party - the incumbent leader in parliament (PSOE), whose leader is current Prime Minister Pedro Sanchez. The party won 122 seats, a marginally better result than before. In third place was the far-right Vox party with 33 seats, which could be a potential coalition partner for the PP. However, 176 seats are needed to form a government majority, which means that other scenarios are possible, such as a government of the left and separatists or another election. It is noteworthy that the Vox party, which is called an extremist far-right party, has the largest decline among all parties, but at the same time the number of seats it has won in parliament gives it the opportunity to enter into a coalition with the People's Party.
In an evening speech, Prime Minister Sanchez expressed satisfaction with "declining" support for right-wing parties, although at the same time, support for the PP party itself has increased. Some believe that Sanchez will try to block Feijoo's ability to form a government, which could mean another period of instability in Spain, as is currently being seen in the Spanish stock market.
SPA35 (IBEX) is losing heavily at the open due to uncertainty over the formation of a new government. SPA35 opens with a gap, the lowest since July 18. Source: xStation5
