MADRID (Reuters) ? A landslide conservative win in Spain's election failed to calm markets on Monday and Prime Minister elect Mariano Rajoy was under pressure to end uncertainty by giving rapid details of his policies to combat the worst economic crisis for decades.
Rajoy's center-right People's Party (PP) notched up the biggest election victory in 30 years on Sunday, with angry voters savaging the outgoing Socialists for a crisis that has pushed unemployment in Spain to more than 20 percent, the highest in the European Union.
The Socialists were the fifth euro zone government to be toppled this year by a debt crisis that now seems out of the control of vulnerable individual countries, with Spain following Greece, Ireland, Portugal and Italy.
But with little real detail on Rajoy's plans, the victory did not impress markets and the spread between yields on Spanish government bonds and safe haven German bunds widened by more than 20 basis points to around 470.
Ten-year yields were higher, at 6.58 percent, creeping closer to the perilous 7 percent level that forced Greece, Portugal and Ireland to seek bailouts.
Under Spain's long transition process, Rajoy will not take power until around December 20 but he has little time to bask in the huge victory for his People's Party.
There is pressure for him to calm jittery markets with some word on what are expected to be deep and painful austerity measures. Since his victory he has only said that there will be no miracles to fix the crisis.
By late morning there was little sign of any statement and PP headquarters said nothing was planned.
"The fact that investors have to wait another month for Mr Rajoy's cabinet to take the reins only adds to the uncertainty," said Nicholas Spiro of Spiro Sovereign Strategy.
However, Jaime Garcia Legaz, an economist at the PP's think-tank, said he expected Rajoy would announce "shock measures" before the formal handover.
Spaniards are resigned to a battery of reforms to resuscitate the economy that could make things worse before they get better and at least initially increase unemployment, with 5 million people already out of work.
The PP won the biggest majority for any party in three decades, taking 186 seats in the 350-seat lower house.
PROTESTS
But small leftist parties also enjoyed a premium from the Socialist rout, with many voters turning to them rather than the conservatives, who they fear will slash Spain's treasured national health and education systems.
This is likely to renew protests when Rajoy's reforms become clear, after a lull in Indignados (Indignant) demonstrations before the election.
"I think there will be people in the street when they see what they are going to do," said Jose Antonio Garcia, a 28-year-old left-wing voter.
Taxi driver Tomas Ruiz, 29, agreed: "The result is outstanding for the right... but it also reflects huge discontent. I think they will do what they like in parliament but people will be out on the street."
Small parties doubled their presence in the lower house of parliament, taking 54 seats compared with 26 in the last legislature, but this will translate into little real power because of the PP's overwhelming majority.
The Socialists slumped to 111 seats from 169 in the outgoing parliament, their worst showing in 30 years.
Rajoy has so far pointed to labor market and a financial reform as well as sweeping changes in the public sector, but has not given clear policy lines, relying instead on voter anger against the Socialists to propel him into power.
Peter Goves, interest rate strategist at Citi, said the real solution to the euro zone crisis lay outside Spain. "The wider systemic issues will have to solved at a euro zone head level," he said, echoing a widely held view.
Voters blamed the Socialists for reacting too late to a collapsed housing boom which has left the nation sliding toward its second recession in two years.
"There will be no miracles, we haven't promised them, but we have seen in other times that when things are done well, they produce results," Rajoy, 56, told rapturous supporters in his victory speech on Sunday night.
Rajoy, a former interior minister, is seen as market friendly and pro-business, although the landslide victory was anticipated for months in opinion polls.
BOND AUCTIONS
The Spanish Treasury heads back to the markets with debt auctions on Tuesday and Thursday this week, the first key tests of confidence in Rajoy's leadership.
Economic gloom dominated the election campaign, with more than 40 percent of young Spaniards unable to find work and a million people at risk of losing their homes to the banks.
When the Socialists took power in 2004 Spain was riding a construction boom fueled by cheap interest rates, infrastructure projects and foreign demand for vacation homes on the country's sunny coastlines.
But the government, consumers and companies were engulfed in debt when the building sector collapsed in 2007, leaving the landscape dotted with vacant housing developments, empty airports and underused highways.
Many Spaniards saw no reason for joy just because of the election result.
Oscar Ortega, a 38-year-old building concierge, said: "I want to believe that they are going to help us but it seems to me to be a shame to celebrate a victory in the situation we are in. I don't know what those people in the street last night were celebrating. Let's do that when we have a solution."
(Additional reporting by Elisabeth O'Leary, Paul Day, Tomas Cobos, Emma Pinedo, Judy MacInnes and Carlos Ruano; Writing by Barry Moody; Editing by Angus MacSwan)
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