how can I fix my fiat punto 1996?

The first question is which red light? Is the temperature gauge right up? If it is then the car's over heating, the most likely cause is the thermostat. This is located on the passenger end of the engine block underneath the spark distribution leads. It's held in place by 2 bolts, 10mm I think. You have to replace the whole unit including the cover, but they're still only £10-15. You'll also need a jubilee clip to reattach the hose because you can't reuse the one that's on (about £2 from B&Q).
If it's only doing it in traffic it might be the fan that's at fault, you can test it by disconnecting the battery, pulling the lead off the back of the radiator temperature switch (lower passenger side of the radiator) and jamming a hair clip in to the contacts on the end. If the fan starts when you reconnect the battery then it's okay. If not replace the fan. If it does reconnect the lead and run the engine until it heats up, if the fan doesn't cut in you'll need to replace the switch in the radiator. Pull the lead back off and simply unscrew the whole switch, you'll need a 30mm socket. Put the new switch in and reconnect the lead, check the fluid level in the radiator and repeat the test.
If none of that works it's probably the water pump, you can do this yourself but it's a bit of a pain. It's at the bottom of the engine at the driver's end. If the pump is knackerd then get it replaced quickly or it'll snap the timing belt too and then it'll be a whole new engine. Hope this helps!

Aidan Henderson
November 2006