Why has there been a struggle to form a coalition government?
"Significant steps forward have been made on the composition of the government and on the [nomination] of a prime minister", the statement said following a meeting between League leader Matteo Salvini and Five Star chief Luigi Di Maio.
Salvini, who has mostly campaigned on an anti-immigration platform, could potentially take the role of interior minister with Di Maio as foreign minister.
Investors were also selling Italian government debt, sending yields higher. Berlusconi said his party was ready to consider giving its support on individual measures, evaluating them on a case-by-case basis as to whether they are in line with the center-right platform. "Either we reach a conclusion, or we return to the voters". Di Maio said he planned to meet Salvini on Thursday.
After Mattarella names a prime minister seen as being outside any party structure, that person then applies the same standard in compiling a list of potential cabinet members. It makes no sense."To hammer out a common government programme, top League and 5-Star members met on Thursday afternoon".
Ken Jeong jumps from stage to give medical aid
Then he returned to the stage and finished his routine. "He was playing with them from the stage for a second", Holmberg says. Heather Holmberg, who was in the audience at the time, took to Twitter to share her first-hand experience.
Both the League and Five Star are staunchly opposed to a caretaker government and without their support the initiative would not pass a confidence vote in parliament. He added that his stand did not mean the end of the center-right bloc.
"With Berlusconi out, an anti-establishment government is one step closer to reality and while both these parties may have their differences, they are united in at least one thing: more fiscal stimulus", said Antoine Bouvet, a rates strategist at Mizuho in London.
Lina Palmerini, analyst at the business daily Il Sole 24 Ore, said Mattarella has few options, warning: "If parliament rejects the president's government, the situation will be very hard". "This coalition was the most feared by markets even before the vote, given their anti-establishment views, and market impact has been limited by their less extreme views on the euro and Europe since their campaign, but the impact may only emerge in the longer term".
A clearly frustrated Mr Mattarella has tried for weeks to break the stalemate but various proposals for alliances failed, primarily after Mr Salvini refused to abandon his partnership with Mr Berlusconi to enter into a coalition with the 5-Star.
Italy's ex-premier has a scandal-filled career, including a tax fraud conviction.
Luigi Di Maio of the Five Star Movement (L) and Matteo Salvini of the League are said to be finalizing a deal. "We are going to vote in July". That would trigger a snap election perhaps for July.