Investors eyed developments in Greece, after the country's parliament failed to elect a president on Monday. General elections are now expected in January, potentially disrupting Greece's hard-won economic and political progress.
Anxiety over oil and Greece dragged most Asian indices lower on Tuesday, with Tokyo, Seoul and Hong Kong hitting fresh lows. Wall Street stocks also traded mostly lower.
In individual stocks news, shares of U.K. clothing retailer Next jumped up to 3.9 percent after the company released a trading statement Tuesday and announced a special dividend for shareholders.
On the data front, Spanish retail sales figures for November rose 1.9 percent (year-on-year) and the country's consumer price index fell more than expected on Tuesday with a year-on-year fall of 1.1 percent in December.
Read MoreEurope deflation fears are back after weak data
In the U.K., the Nationwide House Price index showed that annual home price growth slowed again in November for a fourth straight month.
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