Italy - Factors to watch on Dec. 18

Tue Dec 18, 2012 2:40am EST

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 (*).

U.S. FISCAL CLIFF

Asian shares and other risk assets rose on Tuesday as signs of compromise sparked new optimism that the U.S. "fiscal cliff" budget tussle could be settled before tax hikes and spending cuts begin to bite early next year.

ITALY POLITICS

Whichever party wins Italy's next election must make wide-ranging reforms after opportunities were wasted during the turbulent legislative period now drawing to an end, Italian President Giorgio Napolitano said on Monday.

FINMECCANICA

General Electric Co is close to finalising an agreement to buy Italian aerospace supplier Avio as early as this week for more than 3 billion euros, sources close to the deal said on Monday. * Il Messaggero said Safran had also presented a formal expression of interest for Avio to the Italian government, which would avoid a break-up of the company and would result in a slightly higher offer than GE's.

* GENERALI

The Bank of Italy, which meets on Tuesday to discuss the fate of its 4.5 percent stake in the insurer, will cede it to the Italian Strategic Fund (FSI), the investment arm of state holding Cassa Depositi e Prestiti, several newspapers said.

FSI will in turn sell the stakeon within two or three years, according to Il Sole; according to other newspapers, it will sell two-thirds of the stake after three years. The fund will have no representation on Generali's board. The central bank will take a stake in FSI in exchange for its Generali holding.

The CRT foundation wants to accelerate its separation from Ferak, with which it has a joint venture holding 2.15 percent of the insurer, La Stampa said.

* FIAT

The carmaker can already use, under certain conditions, some of Chrysler's liquidity, Il Sole 24 ore said citing CEO Sergio Marchionne. It also quoted Marchionne as saying closing one of the company's Italian plants would csot the carmaker 600 million euros and would result in savings of only 100 million euros a year.

According to Corriere della Sera, the production of a small car to replace the Punto model is being considered.

FIAT INDUSTRIAL

Shareholders of tractor and construction equipment maker CNH on Monday approved an extraordinary dividend as part of plans to merge with parent Fiat Industrial.

GEMINA

The Italian government is expected not to ratify an agreement on airport tariffs, effectively blocking a 2.5 billion euro investment plan for Rome's Fiumicino airprot in the next 10 years, Il Messaggero said.

ACSM AGAM

The local utility will invest 83 million euros over the next three years as the domestic utility focuses on expanding its gas distribution business.

For Italian market data and news, click on codes in brackets:

20 biggest gainers (in percentage)............

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FTSE IT allshare index

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Stories on Italy...... IT-LEN

For pan-European market data and news, click on codes in brackets: European Equities speed guide................... FTSEurofirst 300 index.............................. DJ STOXX index...................................... Top 10 STOXX sectors........................... Top 10 EUROSTOXX sectors...................... Top 10 Eurofirst 300 sectors................... Top 25 European pct gainers....................... Top 25 European pct losers........................ Main stock markets: Dow Jones............... Wall Street report ..... Nikkei 225............. Tokyo report............ FTSE 100............... London report........... Xetra DAX............. Frankfurt market stories CAC-40................. Paris market stories... World Indices..................................... Reuters survey of world bourse outlook......... Western European IPO diary.......................... European Asset Allocation........................ Reuters News at a Glance: Equities............... Main currency report:...............................

($1 = 0.9866 Canadian dollars)

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