Candidates head to New Hampshire after Iowa joy for Cruz and Sanders

Among Democrats, Vermont Senator Bernie Sanders rode a wave of voter enthusiasm to a virtual tie with Hillary Clinton, long considered her party’s front-runner.

The outcome in the country’s first nominating contest drew a line under voter dissatisfaction, especially among Republicans, with the way government in Washington operates, with anger over growing income inequality and fears of global terrorism.

Mr Cruz’s victory in Monday’s caucuses, which drew a record turnout, was a blow to billionaire Mr Trump, who has roiled the Republican field for months with controversial statements about women and minorities.

Mr Cruz, a fiery, conservative Texas senator loathed by his own party’s leaders, now heads to next Tuesday’s first-in-the nation primary vote in New Hampshire as an undisputed favourite of the furthest right voters, including evangelical voters and others who prioritise an abrupt break with President Barack Obama’s policies.

But Mr Trump still holds a commanding lead in New Hampshire and national polls.

“Iowa has sent notice that the Republican nominee and next president of the United States will not be chosen by the media, will not be chosen by the Washington establishment,” Mr Cruz told supporters.

Mr Trump came in second, slightly ahead of Mr Rubio, whose stronger-than-expected finish could help cement his status as the favourite of mainstream Republicans who fear that Mr Cruz and Mr Trump are too radical to win November’s general election.

Mr Trump sounded humble in defeat, saying he was “honoured” by the support of Iowans. He vowed to stay in the fight, telling cheering crowds that he will go on to “beat Hillary or Bernie or whoever the hell they throw up”.

In the Democratic race, Iowa caucus-goers were choosing between Mrs Clinton’s pledge to use her wealth of experience in government to bring about steady progress on party ideals and Mr Sanders’s call for radical change in a system rigged against ordinary Americans. Young voters overwhelmingly backed Mr Sanders.

Mrs Clinton, the former secretary of state, US senator and first lady, was hoping to banish the possibility of dual losses in Iowa and in New Hampshire, where she trails Mr Sanders, who is from neighbouring Vermont. Two straight defeats could throw into question her ability to defeat the Republican nominee.

For Clinton supporters, the tight race with Mr Sanders was sure to bring back memories of her loss to Mr Obama in the 2008 Iowa caucuses. Mrs Clinton appeared declared she was “breathing a big sigh of relief”. She stopped short of claiming victory.

Mr Sanders had hoped to replicate Mr Obama’s pathway to the presidency by using a victory in Iowa to catapult his ideals of “democratic socialism” deep into the primaries.

“It is too late for establishment politics and establishment economics,” said Mr Sanders, who declared the Democratic contest in Iowa “a virtual tie”.

Mr Sanders still faces an uphill battle against Mrs Clinton, who has ties throughout the party establishment.

Iowa has long led off the state-by-state contests to choose delegates for the parties’ national conventions. Historically, a victory has hardly been assured the nomination, but a win or strong showing can give a candidate momentum, while a poor showing can end a candidacy.

Some establishment Republican candidates have focused on New Hampshire over Iowa, including ex Florida governor Jeb Bush, Ohio governor John Kasich and New Jersey governor Chris Christie.