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The Social Democrats obtained a seat more than the moderates, and the Sweden Democrats party came in third, if the alliance led for the moderates united with the Sweden Democrats they could leave out the Social Democrats, but the moderates already said that they were not going to ally with the Sweden Democrats party, so the prime minister will remain in office.

It gets a little confusing because they are all "Democrats", sounds like the anti unrestricted immigration folks did not sweep into power?

Yes, something like this ...

We could say that things remain the same as before the elections, but with the government weakened, the anti-immigration party increased its influence but not enough.

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