The Footsie lost over one per cent on Tuesday morning in the aftermath of the Italian national elections, as financial markets reacted to the political uncertainty unravelling in the Eurozone's third-largest economy.The centre-left party led by Pier Luigi Bersani appears to have won the lower house by a narrow margin though the there was an inconclusive vote for the senate. Both Silvio Berslusconi's centre-right party and Beppe Grillo's Five-Star Movement gained a lot of support, with the latter surprising after pulling in a quarter of the vote. With anti-austerity parties faring so well in the elections, there are fears that the government may struggle to pass through the reforms aimed at tackling its budget. With the country now seen by many as "ungovernable", a second election down the line is now looking likely.The yield on a 10-year Italian bond on the secondary debt market soared 31 basis points to 4.77% this morning."Italy is at present ungovernable and that may be the case for some time so long as Italians are this divided on austerity," said market strategist Ishaq Siddqi from ETX Capital. "The pressure this places on peripheral bond yields will also raise the spectre of bailouts for Italy but particularly Spain with markets of the opinion that if the Spanish 10-year pushes above the 6.0% mark, this would raise alarm bells and force the hand of [Prime Minister Mariano] Rajoy's government to request a bailout from the ECB."Spanish benchmark yields were up eight basis points at 5.27% by midday.FTSE 100: Banks, miners bear the brunt of the sell-offCyclical sectors such as banking were firmly out of favour this morning as the political impasse in Italy shook investor confidence. UK lenders Barclays, RBS and Lloyds were all registering steep losses with RBS weighed down by comments from Nomura ahead of its full-year results on Thursday. The broker said that the group "still faces material uncertainties with respect to deleveraging, asset quality and the future shape of operations, and remain cautiously positioned on the name."Costa coffee and restaurant group Whitbread was also lower despite a fourth-quarter update saying that it is on track to hit full-year forecasts. The company did admit that like-for-like sales growth was "slightly surprised" by the poor weather conditions in January.CRH, the building materials firm, edged lower after announcing that its CEO Myles Lee is to retire at the end of the year after five years running the show. The news came as the company reported lower-than-expected sales for 2012.GKN, which reported record annual profits this morning, saw shares push into positive territory. The engineering giant posted a 19% increase in 2012 profit before tax (PBT) and a better-than-forecast 13% rise in revenue.Chemicals group Croda was also a bright spot this morning after saying that it has made an encouraging start to the new year. The company said that PBT rose 6.6% in 2012 on sales which increased 2.3%.FTSE 250: St Modwen drops on placing proposalRegeneration specialist St Modwen tanked early on after proposing a placing to help fund its share in the development of the New Covent Garden Market in London. St Modwen intends to raise additional equity capital through a placing of up to 20m new ordinary shares of 10p each, representing around 9.99% of the company's existing issued share capital. Devro, which manufactures casings products for the food industry, was also lower despite an in-line set of 2012 results, though top-line growth was held back by some cost issues/FX, according to analyst Nicola Mallard from Investec. Chemicals company Elementis was leading the risers after reporting a 12% increase in earnings per share to 20.7p, the highest in the company's history.FTSE 100 - RisersCroda International (CRDA) 2,581.00p +0.98%GKN (GKN) 253.90p +0.63%Randgold Resources Ltd. (RRS) 5,505.00p +0.55%Fresnillo (FRES) 1,507.00p +0.27%Imperial Tobacco Group (IMT) 2,354.00p +0.04%FTSE 100 - FallersBarclays (BARC) 297.25p -4.62%Schroders (SDR) 1,957.00p -4.26%Vedanta Resources (VED) 1,175.00p -3.61%Royal Bank of Scotland Group (RBS) 342.60p -3.44%Whitbread (WTB) 2,475.00p -3.43%Wood Group (John) (WG.) 774.50p -2.88%Aviva (AV.) 348.60p -2.87%Aberdeen Asset Management (ADN) 423.10p -2.85%Lloyds Banking Group (LLOY) 53.37p -2.84%TUI Travel (TT.) 308.90p -2.83%FTSE 250 - RisersElementis (ELM) 233.00p +2.28%Computacenter (CCC) 490.80p +1.24%BH Macro Ltd. USD Shares (BHMU) 19.44 +0.99%Hochschild Mining (HOC) 378.00p +0.80%BH Macro Ltd. GBP Shares (BHMG) 1,999.00p +0.71%Telecity Group (TCY) 934.00p +0.65%Paragon Group Of Companies (PAG) 311.60p +0.65%JD Sports Fashion (JD.) 805.00p +0.62%Enterprise Inns (ETI) 104.50p +0.58%Dialight (DIA) 1,205.00p +0.50%FTSE 250 - FallersSt. Modwen Properties (SMP) 254.00p -8.57%Sports Direct International (SPD) 399.70p -7.15%Man Group (EMG) 101.50p -4.69%Redrow (RDW) 186.80p -4.60%Tullett Prebon (TLPR) 276.30p -4.06%Provident Financial (PFG) 1,470.00p -3.54%Supergroup (SGP) 642.50p -3.53%Henderson Group (HGG) 160.70p -3.48%Soco International (SIA) 362.10p -3.36%Afren (AFR) 140.50p -3.24%BC