Summary of Italian elections

AT STAKE:
To determine the 630 members of the Italian Chamber of Deputies
and the 315 elective members of the Senate.

TIMING OF EVENTS:

This Sunday and Monday – Electors are able to cast their vote from 8.00am to
10.00pm on Sunday, or from 7.00am to 3.00pm on Monday

Turnout to be published 3 times on Sunday + rough projections

Note that low turnout is probably bad for Berlusconi.

Vote count starts at a 3pm on Monday. Initial precise estimates
expected on Monday night. 11pm local time is expected to be the time

to have real good indications.

THE CONTESTANTS:
Mr. Bersani – Socialist. Latest Poll: 33%
Mr. Berlusconi – Center Right. Latest Poll: 28%
Mr. Grillo – Nihilist. Latest Poll: 16%
Mr. Prodi – Center. Latest Poll: 12%

THE SYSTEM:
Bicameral with Senate and Chamber having equal law-making powers

Chamber: the coalition that wins the relative majority will
automatically be given 55% of the seats

Senate: the same principle applies, but to each region meaning that
the final result depends on the performance of each major player in each region
and increase risks of fragmentation. 316 seats are at stake so any coalition must gather

158 seats to have a majority to control the Senate

THE RISKS FOR FINANCIAL MARKETS:
Mr. Berlusconi wins straight. 10% odds

A hung Parliament:
The Chamber because of its system should be won by Mr. Bersani and his allies

The Senate: tougher to predict as it is a State by State thing. If Mr Grillo or Mr
Berlusconi gains momentum towards the end, the risk of a hung Senate is real.

Then 2 scenarii: other elections are called or a “grand coalition” is formed. In both
cases, market’s reaction should be on the downside. Odds: 30-40%

CONCLUSION:

-First turnout results today

-First projections tomorrow afternoon local time
-Senate is key: watch 158 as the key number to gain majority
-the risk of a hung Senate is real. In the 30% magnitude according to experts.

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