Spanish PM Rajoy offers dialogue to form government

Spanish Prime Minister Mariano Rajoy has said he is prepared to speak "with generosity "to other political parties as he starts the difficult task of forming the next government in the wake of Sunday's elections, which left Spain with a hung parliament.

Rajoy's ruling People's Party(PP) won Sunday's vote, but lost a third of their voters and 63 seats in the Spanish Congress, finishing the night with 123 seats, well short of the 176 needed for a majority.

Sunday saw the Socialists finish second with 90 seats, while the left wing Podemos won 69 and center-right Citizens 40.

Both the Socialists and Podemos said on Monday they would vote against Rajoy's Investiture as Prime Minister, while Citizens' leader Albert Rivera has also said he would not support Rajoy, but would consider abstention in the debate.

As a result of the uncertainty caused by the elections result, the Spanish IBEX 35 stock market registered significant losses on Monday.

The PP executive committee held a meeting on Monday evening, after which Rajoy said his party had "the responsibility to launch a process of dialogue to offer certainty within and outside Spain."

"Spain cannot afford a period of political lack of clarity that would spoil the progress achieved during these years," continued Rajoy, who said he would act with "generosity" in his talks with other party leaders.

However, he also said he would not speak to parties which threatened the unity of Spain, which appears to rule out any talks with Podemos, who have called for a referendum on Catalan independence as part of their conditions for supporting any coalition government. Endit