Portugal's Socialist Prime Minister Jose Socrates renewed his mandate with a clear victory in Sunday's parliamentary elections, but remained short of an absolute majority with about 90 per cent of the vote counted.
Conservative leader Manuela Ferreira Leite conceded defeat while a far-left party made important gains.
The results gave the Socialists 36.5 per cent of the vote. Ferreira Leite's Social Democratic Party (PSD) took 29.1 per cent, up from 28.7 per cent in 2005.
The expected results made it look possible that Socrates might form a minority government, raising fears of a weak government unable to conduct the strong policies required by the country's economic crisis.
The far-left Left Bloc, which wants to nationalise sectors of the economy and take Portugal out of NATO, made important gains, increasing its support from 6.35 to 9.8 per cent.
The Left Bloc came just behind the conservative nationalist CDS/PP, which had 10.5 per cent of the vote, up from 7.3 percent in 2005. The communist-green coalition CDU came fifth with 7.9 per cent.
Ferreira Leite stressed that the elections had deprived the Socialists of the absolute majority and pledged that the PSD would act in a "responsible" way as the main opposition party, without allowing itself to be "intimidated" by anyone.
The Left Bloc and CDU have ruled out a coalition with the Socialists, whom they describe as having no real ideological differences with the PSD.
Voter turnout was estimated at around 60 per cent, down from 65 per cent in 2005. About 9.5 million Portuguese were eligible to vote for candidates from 15 parties for the 230-member parliament.
Socrates, who presents himself as a liberal reformer taking Western Europe's poorest country into full modernity, had stressed the need for stability by allowing the Socialists to remain in power.