Rebuked lawmakers for failure to reform election law and for political paralysis.

The 87-year-old incumbent was embraced by all traditional parties, but not Beppe Grillo's 5-star movement.

Financial markets impatiently await an end to the impasse; panel includes lawmakers, professors and a central banker.

President Giorgio Napolitano said the 61-year-old was best positioned given 'the most difficult circumstances'.

Insurgent's stunning election showing speaks to disllusionment with entrenched Italian political elites.