European stock markets opened well down on Tuesday after overnight slides by the Dow and Asian bourses but several global mergers and takeovers looked like underpinning shares.

Frankfurt

In a continuation of Monday's retreat, German shares fell further in response to Wall Street movements.

Profit-taking added weight to the move.

At 0950, the Xetra Dax stood at 4,952.29, down 73.85 from yesterday's Xetra close.

In floor trade, the Dax stood at 4,959.68, down 63.02 from yesterday's floor close.

"We can expect a day of consolidation," said Achim Matzke, an analyst at Commerzbank's Global Technical & Index Research in Frankfurt.

"A lot of the good news connected with mergers has already been absorbed by the market," he added.

Deutsche Bank has formalised its takeover of Bankers Trust, a US investment bank.

Late on Monday, Krupp shareholders supported a merger with industrial group Thyssen, coming a step closer to creating Europe's biggest steel concern.

Early on Tuesday, chemical and pharmaceutical group Hoechst announced the details of the merger of its life sciences business with that of French Rhone-Poulenc to form a new company called Aventis.

The companies said merging their life sciences is a first step to a full-blown merger, which will take place once they both sell their industrial chemical activities.

Degussa said that in the year ended September 30 it saw a higher-than-expected 42% increase in pre tax profits to DM15.9bn.

BMW will come under the spotlight in the lead-up to a supervisory board meeting later today.

The board is scheduled to review an agreement between BMW's Rover unit and UK labour unions.

The agreement is seen by some as a way to save the foundering luxury car unit.

Paris

The Cac 40 index opening was delayed for technical reasons, according to a Paris Bourse spokeswoman.

Paris stocks eventually opened 2.25% lower, continuing Monday's late slide after the Dow closed down 2.32% overnight as a result of heavy profit-taking.

The Cac 40 index was down 2.57% at 3,744.71 at 0934 GMT.

Investors had been moving in to take profits on a view the market may have rallied too far, too fast.

Total opened down 7.8% at 650 francs after announcing plans to merge with Belgium's PetroFina.

Rhone was down 2.12% after confirmation it and Hoechst were to combine drugs/agrochemicals business into 50-50 joint merger.