Using Bold/Italics while composing a message

To italize a word from the Compose window(this is the window you will be in while composing a message)

Click on "Switch to HTML composition" link in the Options area. The Options area is under the To, CC, BCC and Subject area in the Compose window

The message part of the screen would change and you should now have various formatting options.

Highlight the text to be formatted and select the appropriate formatting option available on the formatting toolbar.