Monday, February 25 16:23:32
Projections from an early vote count in Italy's election today showed Silvio Berlusconi's centre right slightly ahead in the Senate, a result that could cause deep government instability if confirmed.
The projections on RAI, Sky, Mediaset and LA 7 television stations were the reverse of earlier predictions from telephone polls that showed the centre left taking a strong lead in both houses of parliament.
The change in predictions had an immediate impact on markets which rose earlier on hopes of a stable and strong centre-left led government.
Such a government, probably backed by outgoing technocrat premier Mario Monti, is seen as the best guarantee of measures to combat a deep recession and stagnant growth.
Berlusconi's aim is to win enough power in the Senate to paralyse a centre-left-led government.
The benchmark spread between Italian 10-year bonds and their German equivalent widened from below 260 basis points to above 280 and the Italian share index lost previous gains.
The earlier telephone polls on Sky and Rai television after voting ended at 3 p.m. (1400 GMT/9 a.m. ET) had showed the centre left of Pier Luigi Bersani 5-6 points ahead of the centre right in both Senate and lower house, with the anti-establishment movement of Genoese comedian Beppe Grillo taking third place.
But early projections on RAI television and based on a small sample of the 47 million electorate showed Berlusconi's coalition, which includes the federalist Northern League, ahead of Bersani in the Senate by just over 2 percentage points. The projections still placed Grillo third.
Italy's electoral laws guarantee a strong majority in the lower house to the party or coalition that wins the biggest share of the national vote.
However the Senate, elected on a region-by-region basis, is more complicated and the result will turn on four key battleground regions. Projections from LA 7 showed Berlusconi winning in three of them: Lombardy, Sicily and Campania. Reuters