Renzi’s resignation could lead to early elections and a rise in support for the populist anti-euro Five Star Movement. The party would seek to carry out a referendum on Italy breaking away from the Euro area.

“For the first time, the polls were clearly expecting that result,” Igor de Maack, fund manager at DNCA Investments, told the WSJ. While many viewed the “no vote” as a long-term negative for Italy, the news “will not change the challenges of the eurozone or the challenges of Italy.”

Specifically, the no vote could prevent the Italinan government from fixing its ailing banking system.

For more information on the European Markets, visit our Europe category.

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