>> Rajoy's position had become increasingly untenable, undermined by his status as head of a corruption tinged minority government, as well as a divisive independence drive in the wealthy region of Catalonia. The Basque Nationalist Party, whose five seats were key to Sanchez securing enough parliamentary backing, withdrew support for Rajoy after dozens of people linked to his people's party were sentenced to jail in a corruption trial.
> It has been an honor to have been Spain's Prime Minister. It is an honor to be able to leave a better Spain than the one I found.
Rajoy's departure will leave one of the European Union's top four economies navigating an uncertain political landscape. The new administration may struggle to pass legislation. Though Sanchez said he will stick to the budget put forward by Rajoy, his party has only 84 four seats in the 350 seat Parliament.
Markets reacting calmly, however, the coalition is seen as reliably pro-EU, meaning there's no echo of the worries of Italy where Euro skeptics are set to take over. A general election is due in Spain by mid-2020, and it's unclear if a snap vote will be called before that.