Italy - Factors to watch on Sept 4

The following factors could affect Italian markets on Tuesday.

Reuters has not verified the newspaper reports, and cannot vouch for their accuracy. New items are marked with (*).

EURO ZONE CRISIS * Moody's Investors Service cut the outlook on the Aaa rating of the European Union to negative, warning it might downgrade the bloc if it decides to reduce the ratings on the EU's four biggest budget backers: Germany, France, UK and Netherlands. * Italy's Prime Minister Mario Monti meets French premier Francoise Hollande in Rome at 1100 GMT as part of shuttle diplomacy among euro zone leaders to discuss ways to solve the bloc's sovereign crisis.

Purchases of short term sovereign bonds by the European Central bank would not breach European Union rules, the ECB's President Mario Draghi told European lawmakers on Monday, according to a recording obtained by Reuters.

EURO ZONE BANK SUPERVISION

Germany clashed with Brussels on Monday over plans to give the ECB new banking supervision powers, saying it was unrealistic for it to oversee more than the bloc's biggest institutions and wrong to expect the new body to be in place by year-end.

ITALY DEFICIT

Italy posted a state sector budget deficit of around 6 billion euros in August, narrowing from a deficit of about 6.9 billion euros in the same month last year, the Treasury said on Monday.

FIAT Italian new car sales fell 20.23 percent in August from the same month a year ago to 56,447 vehicles, Italy's Transport Ministry said on Wednesday.

* FINMECCANICA

Italy's defence group Finmeccanica aims to win new contracts in Poland for up to 1.5 billion euros as the country is planning to put up for tender defence and aerospace equipment contracts, Italian Il Sole 24 Ore reported on Tuesday.

ERG

Italian energy group ERG said on Monday it had completed the sale of a 20 percent stake in the ISAB refinery in Sicily to Russia's Lukoil for 485 million euros.

HERA

Italy's Hera said on Monday it had accepted an offer from state-controlled investment fund Fondo Strategico Italiano (FSI) to buy a stake in the regional utility that could reach about 6 percent. * The FSI is ready to consider buying stakes in other multi-utilities like Hera, the CEO of Cassa Depositi e Prestiti, which controls FSI, told La Repubblica. He said investing in utilities that focus on one business, such as power generation, was not easy for antitrust reasons since CDP controls power grid operator Terna.

* ATLANTIA

The company is part of a consortium that has made an offer, along with four other groupings, to win a Turkish tender for the privatisation of two Istanbul bridges and eight motorways across the country, the country's Privatisation Administration (OIB) said on Tuesday.

* GLENCORE

A meeting on Wednesday at the Industry Ministry about a possible takeover of Alcoa's Sardinia plant by Switzerland's Glencore has been put back to Sept 10, Il Sole 24 Ore said.

* FONDIARIA-SAI, UNIPOL

Fondiaria's managing director Piergiorgio Peluso is set to leave the insurer as it gears up to merge with peer Unipol, Il Messaggero said. Peluso has several opportunities, the paper said.