Spaces, new lines, tabs, semicolons.

Tip: Recall "five problematic characters" concept.

Answer: First alert 1 (value of x), second alert 0 (value of y).

Explanation: There are "five problematic characters" to be careful with : "(" , "[" , "+", "-" , "/".
Never omit a semicolon before a statement beginning with the "five problematic characters".
Since -- can serve as either a prefix or a suffix, but the -- cannot be preceded by a newline.

The snippet is equal to:

var x=1, y=1;
x;
--
y;
alert(x);
alert(y);

Read it for details:
wikipedia.org: Whitespace and semicolons
Looks here in case you think that really know how it works