Italy's Generali, banks fall as Unicredit's Orcel looks away
** Italian banks Mediobanca MDBI.MI and Banco BPM BAMI.MI, and insurer Generali GASI.MI are all down after Unicredit bought on Wednesday a 9% stake in Commerzbank, Germany's second largest lender
** Stocks are down as the Commerzbank acquisition reduces the potential for an M&A deal in the Italian banking sector, a Milan-based trader says
** Italy's second-largest bank has been linked to a number of deals, both in Italy and Europe
** The Italian banks index .FTITLMS3010 is down 0.4% at 0950 GMT, with Mediobanca down 2.1%, Banco BPM losing 1.8%, and Italy's biggest bank Intesa Sanpaolo ISP.MI edging down 0.1%
** Banco BPM "was the most likely Italian domestic target for Unicredit," writes Citi in a research note, adding that it would be difficult for Unicredit "to run 2 parallel integrations, in Italy and Germany."
** In February Italian media had reported that a large investment bank had drawn up a feasibility study on a possible merger between Unicredit and Generali
** Generali shares slip down 0.5%
** "Unicredit has finally chosen a clear path for its expansion strategies: increase its exposure to Germany", says IG Italia Analyst Filippo Diodovich
** Shares in Unicredit are down 0.5%. Up to Tuesday's close shares were up 46.9% YTD
Reporting by Alberto Chiumento, Giancarlo Navach, editing by Giulia Segreti
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