European markets closed mostly lower on Tuesday, as a decline in commodity prices and mixed earnings news offset positive sentiment surrounding the latest comments from the European Central Bank.
Oil prices struggled to stay afloat in late trade, despite Brent rallying over 6 percent in the morning session. Prices came under pressure after some of the world's leading oil producers, including Saudi Arabia and several key OPEC members, dashed hopes of a potential cut in supply.
Qatar, Saudi Arabia, Russia and Venezuela announced they would lead an effort to freeze output at January levels if other exporters joined the pact. Iran added fuel to the fire by saying it wouldn't abandon its share in the current oil market. Consequently, oil prices came off session highs and fell into negative territory, with Brent off some 3 percent, around $32.32 a barrel and U.S. crude last trading at $29.
European markets rallied at the open earlier after European Central Bank (ECB) President Mario Draghi hinted at further monetary policy easing. Draghi said on Monday that the ECB is "ready to do its part" to make "the euro area more resilient", hinting at further stimulus measures to come.
On the earnings front, French power utility EDF saw net income plunge 68 percent in 2015 after it took a 3.64 billion euro one-off impairment charge. The company also cut its dividend from 1.25 euros to 1.10 euros, but shares jumped 9.5 percent.
Meanwhile, telecoms company Orange saw 2015 revenues fall 0.1 percent and said that discussions over the purchase of rival Bouygues' telecoms unit would take "at least several weeks before any decision is taken". Orange shares closed just above the flat line, while Bouygues fell more than 1 percent.
Banks remained a key focus for investors Tuesday, with Standard Chartered being the worst performer, falling more than 5 percent after several brokerages cut their target prices following a recent rally.
The miners were also in focus after Anglo American posted a $5.62 billion net loss for 2015. Anglo American also suspended its dividend and said it would resume "with payout ratio when appropriate". Shares closed 1.2 percent higher, despite rallying 6 percent in early trade.
Stocks in the auto sector were in focus and initially buoyed by two key pieces of news. Firstly, tiremaker Michelin said net profits rose 13 percent in 2015 and said it expects demand for passenger car, light truck and truck tyres to continue to rise this year, sending shares to close over 3 percent up.
Secondly, European car sales rose 6.3 percent in January, according to the European Automobile Manufacturers Association. But registrations of Volkswagen brand cars slumped 4 percent in the wake of the diesel emissions scandal, though the VW Group as a whole saw a 1 percent rise in sales. Shares in Volkswagen reversed gains to close 1.6 percent down.
On the data front, U.K. inflation rose 0.3 percent in January on the year, its highest level since January 2015. But the annual rate of inflation has been below the Bank of England's 2 percent target for two years.
And the closely-watched German ZEW economic expectations index came in at 1.0 for February, falling from 10.2 in January, with the organization pointing towards a slowdown in the global economy and uncertainty over falling oil prices as the reason for the negative sentiment. ZEW's current conditions index for February came in at 52.3, compared to 59.7 in January.