People are cautiously optimistic in Jerusalem after Prime Minister Benjamin Netanyahu's narrow election win against a new centrist challenger who catapulted into second place. (SOUNDBITE) (English) JERUSALEM RESIDENT SHIMON POMERANTZ SAYING: "I think for an election that was contested and a concern to a lot of us, Israel voted smart. It's an opportunity now for the government to eliminate the influence, the over influence, of the religious parties. The prime minister was shown that he did now have such a strong mandate, but still the people want him as prime minister" Exit polls showed Netanyahu's coalition would still be the biggest bloc in the 120-member assembly-- but they lost nearly 25 percent of the seats they held in the previous parliament. (SOUNDBITE) (English) JERUSALEM RESIDENT NOFET OROVITZ SAYING: "Am a bit surprised, I did not expect Yair Lapid to get so many votes. Am a bit surprised and how do you say, disappointed." Netanyahu promised during his election campaign to focus on tackling Iran's nuclear ambitions if he won, shunting Palestinian peacemaking well down the agenda. (SOUNDBITE) English) MEIR NOAM, RESIDENT OF JERUSALEM SAYING: "I think the results are not surprising because I think Mr. Netanyahu, most of his agenda was a foreign agenda and also about security. People, many people, most of the population is also concerned about home about earning money about a good life, and I think he neglected it a little bit." The projections showed right-wing parties with a combined strength of 61-62 seats against 58-59 for the centre-left.