U.S. sovereign bond prices were higher Tuesday, as a global rally in equities faded and risk-aversion rose.
In the U.S., the dollar index hit a four-month high after data showed U.S. housing starts rose by more than expected in June.
Global sentiment dipped Tuesday as oil markets edged lower. European stocks fell lower with the DAX down nearly 1 percent. German investor morale fell in July to the lowest level since November 2012 and much more than expected, a survey by German think tank ZEW showed on Tuesday.
Meanwhile, a lending survey by the European Central Bank showed that euro zone banks were expected to lend at a moderate pace in the third quarter of this year. This despite the U.K.'s decision to leave the European Union last month.
In Asia, markets closed mixed with the Nikkei climbing despite shares of heavily weighted SoftBank tumbling around 10 percent after its $32 billion bid for a British chip firm.