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Italian stocks fall as Prime Minister Mario Monti resigns

News that Italian Prime Minister Mario Monti plans to resign saw Italian stocks fall sharply.

Mario monti 08 07 2012Enlarge
Mario Monti had planned to serve until April 2013 when the current parliamentary term runs out. (Gabriel Bouys/AFP/Getty Images)

The announcement that Italian Prime Minister Mario Monti plans to resign sent Italian stocks plummeting on Monday.

The main Italian stock index fell 3.1 percent, while other indexes throughout Europe were also lower.

BBC News noted that banks were the "worst hit among shares."

Reuters reported that analysts attributed the volatility in the stock market to uncertainty regarding the make-up of Italy's next government, rather than the prospect of Berlusconi's return to power.

"[Monti’s] decision has clearly been met with anxiety in the markets, with Monti’s government seen as imperative to Italy’s stability,” Craig Erlam, market analyst for London-based Alpari, told AP.

Monti announced on Saturday he would resign following the passing of the 2013 budget, and said it was impossible to carry on in government after the political party of Silvio Berlusconi withdrew its support for the government and said Berlusconi would run to become premier for a fifth time. 

"I'm returning sadly to public service," Berlusconi told reporters over the weekend, in the middle of watching a practice session at the soccer club he owns, AC Milan. (The comments were broadcast on the news network he also owns, TGCOM24.)

"And again I'm doing it out of a sense of responsibility," the 76-year-old, three-time prime minister said.

More from GlobalPost: Best of Berlusconi: Quotes, gaffes, awkward political moments

http://www.globalpost.com/dispatch/news/regions/europe/italy/121210/prime-minister-mario-monti-resignation-results-italian-sto