Spain voted in national elections on Sunday, and the result is expected to be weeks or even months of political uncertainty. The governing conservative Popular Party of Prime Minister Mariano Rajoy won the most votes, getting 123 seats in Spain's 350-seat parliament, but that's a sharp drop from the 186 seats it won four years ago and 53 seats shy of the 176 it needed for a ruling majority. The opposition Socialist party came in second, with 90 votes, while two new parties — the leftist, anti-austerity Podemos party and the centrist, business-oriented Ciudadanos party — came in third and fourth place, with 69 and 40 seats, respectively.
Neither of the natural coalitions — PP-Ciudadanos or Socialist-Podemos — would have enough seats to form a governing coalition, and it's unlikely Rajoy will pick up the support of the regional parties that make up the bulk of the remaining 28 seats. Spain has never had a "grand coalition" government where the two main established parties join together, and based on campaign rhetoric, the PP and Socialists aren't expected to form the first one. Ciudadanos has said it won't join with the PP as long as Rajoy is prime minister, given the corruption in his government, but it could abstain from voting in parliament, allowing Rajoy to form a minority government.
After the results were announced, Rajoy said he will "try to form a stable government," without specifying how. Socialist leader Pedro Sanchez said that Rajoy has first crack at forming a government, but that whatever happens, Spain is "entering a new political phase." Podemos leader Pablo Iglesias has a similar message, but one he delivered with evident glee: "Spain is not going to be the same anymore." Investors reacted negatively to the election results early Monday. For more, you can watch The Wall Street Journal's Mark Kelly report below. Peter Weber