The final election count in Israel revealed that neither Prime Minister Benjamin Netanyahu's right-wing bloc, which secured 53 seats, nor the opposition led by Gadi Eisenkot, with 48 seats, achieved the 61 seats necessary to form a government. This outcome initiates a phase of coalition bargaining, with significant political uncertainty ahead.
Netanyahu's Likud party has alleged that Arab-led parties 'stole' the election, prompting calls for investigations into potential foreign interference, particularly from Qatar, which has denied these claims.
The political landscape is further complicated by the fact that the Joint List and Ra’am, which represent Arab interests, won a record 19 seats, but their inclusion in coalition talks is contentious. The Central Elections Committee has stated that while the vote count is complete, minor corrections may still occur before the results are certified.
The new Knesset is scheduled to be sworn in on November 10, with parties having until November 18 to contest the results. Analysts predict that the political stalemate could lead to Netanyahu serving as a caretaker prime minister, with the risk of renewed conflict with Iran looming.
Israeli financial markets have reacted negatively, with the shekel experiencing significant volatility and the Tel Aviv stock index dropping 4.1% for the week. Eirini Tsekeridou from Julius Baer anticipates continued volatility in Israeli assets until a new government is established, although she believes the country's economic fundamentals will provide some support.
President Isaac Herzog will consult with party leaders next week to identify a candidate capable of forming a majority government, with Netanyahu likely to be the first approached in this process. If coalition talks fail, new elections may be called, prolonging the current political uncertainty