When this is translated into seats, the two groups together control a majority in both houses. This means the next government will have to rely on support from one of these Eurosceptic populist movements -- or both.
The prospect of a government including the M5S or the League will put immediate downward pressure on Italian bank equity and bond prices.
The result will raise EU concerns about Italy’s ability to meet fiscal targets; both movements campaigned on an expansionary fiscal policy.
The outcome will deepen divisions within the centre-left and -right as politicians come under pressure to support some governing majority.
Italy may become marginalised in debates about the completion of the EU’s banking union and euro-area reform.
The result will put downward pressure on bond yields as investors look ahead to the possible end of large-scale ECB bond purchases.
