At the bottom of benchmarks, shares of Italian lender BMPS tanked nearly1 7 percent on the second day of a planned capital increase.
U.S. stocks traded lower on Tuesday as investors eyed renewed strength in the U.S. dollar and mixed data following the Memorial Day holiday.
The Dow Jones industrial average traded about 200 points lower after falling more than 100 points soon after the open.
The Nasdaq fell more than 1 percent as tech stocks declined. Information technology led declines in the S&P 500, with First Solar,Autodesk and Hewlett-Packard the greatest laggards.
Gains in Europe were also capped by events in Greece, which is locked in talks over a disputed aid-for-reforms deal with its international bailout supervisors. Key sticking points in negotiations are pensions and sales tax.
The country needs urgent aid to repay a loan due next week to the International Monetary Fund and to pay wages and pensions, its government said on Monday. The Greek finance ministry will hold a teleconference with European officials on Tuesday evening.