Markets calm on signs that Italy may avoid elections

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Financial markets have calmed amid signs that Italy may avoid imminent elections after President Sergio Mattarella gave two populist parties time to figure out whether they can agree on an alternative to a euroskeptic economy minister.

The leader of the 5-Star Movement, Luigi Di Maio, has proposed moving the contested ministerial candidate to a different Cabinet post. League leader Matteo Salvini, meanwhile, said he isn't closing the doors on any solution. But he's also showing some resistance to the change, saying "if someone in Berlin or Paris wakes up in a bad mood that doesn't mean that an Italian minister gets kicked out."

Mattarella gave the leaders time to form a coalition government after markets plunged on news of an interim administration that would take Italy to new elections.