Italy - Factors to watch on March 18

Mon Mar 18, 2013 3:29am EDT

The following factors could affect Italian markets on Monday.

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

*REACTION TO CYPRUS BAILOUT

European shares were expected to fall sharply on Monday, with Cyprus' plan to tax depositors rattling investors who are concerned that the move, if passed, could set a precedent for future euro zone bailouts.

Japan's Nikkei share average dropped 2.7 percent on Monday, pulling back from a 54-month high and posting the biggest slide in 10 months after a proposed bank bailout for Cyprus spooked investors.

German Bund futures rallied and Italian futures fell on Monday as demand for low-risk assets jumped after the euro zone forced Cypriots to pay a levy on their savings in exchange for a sovereign bailout.

The euro zone struck a deal on Saturday to hand Cyprus a bailout worth 10 billion euros ($13 billion), but demanded depositors in its banks forfeit some money to stave off bankruptcy despite the risks of a wider bank run.

Cyprus becomes the fifth country after Greece, Ireland, Portugal and Spain to turn to the euro zone for financial help in the wake of the region's debt crisis.

ITALY POLITICS

Italy's centre-left alliance scraped a narrow victory in a vote to appoint the new speakers of parliament on Saturday but the fragile margin of success underlined how hard it will be to form a stable government after last month's deadlocked election.

Beppe Grillo, leader of Italy's anti-establishment 5-Star Movement, demanded that parliamentarians in his group declare their votes openly after some apparently defied party orders in a secret ballot to appoint the speaker of the Senate.

The neophyte 5-Star Movement's lawmakers were, among other things, housewives, students or jobless before they took their seats in Italy's parliament on Friday, and it remains a mystery how they will handle their newly won power.

Former Italian prime minister Silvio Berlusconi, facing trial on tax fraud and sex charges, abused protesters who whistled and jeered as he entered parliament on Saturday to vote in an election for speaker of the Senate.

Italian President Giorgio Napolitano told Prime Minister Mario Monti on Saturday he would need to stay on as long as political parties fail to reach an accord that would allow a new government to be established after a deadlocked election.

Italy can not count on the European Central Bank (ECB) buying up its bonds if its borrowing costs rise as a result of its politicians discussing rowing back on reforms, ECB Bank policymaker Jens Weidmann warned in a German magazine.

UNICREDIT

UniCredit set aside nearly 10 billion euros to cover bad loans in 2012 and said the country's longest recession in 20 years would continue to hit earnings this year.

The bank also announced that it is selling its Kazakh unit ATF Bank and will review its business targets through to 2015 in light of the "exceptionally difficult" economic environment.

UniCredit has seen the first hint of glasnost among European bank regulators. The Italian bank is moving 1 billion euros from German subsidiary HVB back to the parent company. It could mark the beginning of the end of a worrying trend towards balkanization in the supposedly-single European banking market.

BANCO POPOLARE

Italy's number four lender said on Friday its full-year net loss widened compared to an earlier profit warning, after it made extraordinary writedowns in the fourth quarter.

MOLESKINE IPO

Italy's Moleskine will open books on Monday on an initial public offer (IPO) valuing the maker of black notebooks at up to 561 million euros ($733 million) and bringing a majority stake onto the market.

IMPREGILO

Italian builder Salini said it did not plan to delist Impregilo if its recently launched takeover bid of the company was successful, Il Sole 24 Ore reported on Sunday.

GENERALI

The insurer expects first-quarter results "very similar to the fourth-quarter with figures that continue to be positive," chief executive Mario Greco said in an interview with Class CNBC reported in Milano Finanza on Saturday.

He said he hoped to pay good dividends to shareholders.

MONTE PASCHI SIENA

An Italian judge on Sunday ordered the former head of Monte dei Paschi's finance department to return to jail a day after releasing him for a procedural error as part of an inquiry into alleged fraud and bribery at Italy's third-largest bank.

RCS MEDIAGROUP

The debt-laden Italian publisher RCS MediaGroup is considering two rights issues to resolve its financial problems, and will give the go-ahead to launch the first one later this month, sources said.

ENI

The oil and gas company has made a ninth oil discovery in Block 15/06, which lies in deep water off the coast of Angola, the Italian oil and gas company said on Friday.

*AION RENEWABLES

Shares are still suspended pending a statement.

ITALIAN BONDS

Chinks are showing in the Italian bond market's resilience to the political stalemate that followed last month's election.

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

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

20 biggest losers (in percentage).............

FTSE IT allshare index

FTSE Mib index........

FTSE Allstars index...

FTSE Mid Cap index....

Block trades..........

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:...............................

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