FTSE, DAX, CAC Set to Dip; Merck, Peugeot Eyed

European stock index futures point to a lower open on Tuesday, with shares set to mirror U.S. and Asian losses, with renewed fears of a recession in Europe and a slowdown in growth in resource-hungry China halting a 2-1/2 month stock market rally.

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The FTSE 100 is seen lower by 12 points, the DAX is seen down by 23 points and the CAC 40 lower by 10 points.

Germany's Merck KGaA will be in focus after missing expectations with its fourth-quarter earnings due to sluggish demand for liquid crystals used in flat screens.

Merck's results underscore a relatively poor European earnings season, during which only 49 percent of the STOXX 600 companies have met or beaten estimates, compared with 68 percent of Wall Street's S&P 500 companies that have met or beaten forecasts, according to Thomson Reuters Starmine.

PSA Peugeot Citroenwill also be in the spotlight after unveiling details of its 1 billion euro capital increase, to be done at a price of 8.27 euros a share.

It represents roughly a 42 percent discount from the stock's closing price of 14.21 euros on Monday.

A crucial day is ahead in the US in the race for Republican presidential nominee as GOP candidates vie for support across 10 states in “Super Tuesday.” For the front runners, Mitt Romney and Rick Santorum, it is being seen as a test of who will take the decisive lead in the race to face Barack Obama in November’s election.

Staying with the States, the meeting between Israeli premier Benjamin Netanyahu and President Obama saw agreement that they would continue to coordinate on Iran. Netanyahu said no decision had yet been made to attack Iran but that military action remained a possibility.

The Financial Times is reporting that UK regulators are considering an overhaul of how interbank lending rates are calculated and regulated following claims that the benchmark LIBOR – London Interbank Offered Rate – may have been manipulated.