The European Central Bank's fail-safe mechanism for the euro's wounded government debt markets has thus far allayed concerns of another fresh round of sweeping creditor strikes. Indeed, ECB chief Mario Draghi's vow from last July to do "whatever it takes" to protect the euro has continually lent confidence to many asset managers that the zone will not be pushed to the edge of oblivion. As such, while stocks and bonds in Italy and across the Eurozone plunged Tuesday, they still remained some distance from crisis peaks.

However, the clearest signal from Italy's convoluted election was its outright abstention of ever more austerity in a shrinking economy. When the initial dust settled, the polls showed no single political entity with a majority in Italy's two houses of parliament and about half the electorate opposed the prior government's policies of austerity. Ultimately, a rejection of budget-cutting that any ECB backstop would require does indeed cast some doubt on what scope that leaves the central bank however, if it does opt to execute the government bond buying program it calls Outright Monetary Transactions.

"This is a very clear protest against austerity and the implications are potentially profound," wrote Russell Silbertson, Head of Global Interest Rates at Investec Asset Management. “The ECB last year made it clear it was willing to help, but only if a country requested that help and agreed to conditions.

As spring approaches, many Eurozone bears are coming out of hibernation, as the main impact of Italy's potential hiatus is to return market pricing to levels better reflecting the region's persistent recession and debt difficulties with some doubts on the OMT support. "We've had months of unusual calm in the euro crisis and we feel this is more of a reality check than a brand new phase," wrote Iain Stealey, portfolio manager in the International Fixed Income Group at JP Morgan Asset Management, adding it was best to steer clear of euro markets until better levels emerged.