Israel's caretaker Netanyahu constrained after election but could keep power to wage war on Iran

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Netanyahu's bloc falls short of a majority as Israel's election ends in deadlock

With 85% of ballots counted, Netanyahu's Likud and its allies are set to win 53 of the 120 Knesset seats, short of a majority. Netanyahu called for a right-wing government, while opposition leader Gadi Eisenkot said voters had rejected him. Arab parties could hold the key, but Netanyahu called a coalition with them 'a disgrace and a shame', and Balad's leader called the opposition bloc's refusal to ally with Arab parties racist. Official results are due on November 4, and one analysis says new elections may be the most likely outcome.

• Likud is the largest party, and Netanyahu's bloc edges past the opposition without reaching a majority, according to partial results.
• Exit polls projected up to 18 seats for the Arab bloc after record turnout among Arab voters.
• Experts say Netanyahu will face greater constraints as caretaker prime minister, though his government could keep significant powers, including the authority to wage war against Iran.
• Israel's Tel Aviv 125 index fell more than 2 percent on Wednesday amid uncertainty over who will lead the next government.