U.S. stocks ended slightly higher Tuesday, with the Nasdaq posting a fresh record close, as investors kept an eye on falling oil prices.
"Certainly oil coming in and the close in the European session contributed" to stocks coming off their highs, said Jeremy Klein, chief market strategist at FBN Securities. "If Europe is grinding higher, we usually go higher with them." European stocks closed higher, with the Stoxx 600 index rising 0.92 percent.
The Nasdaq and the benchmark S&P 500 broke above their previous respective all-time intraday highs of 5,231.94 and 2,185.54 in mid-morning trade, before easing from those levels.
There are "really just very few alternatives for investors around the world," said Jeff Kravetz, regional investment strategist at the Private Client Reserve at U.S. Bank. "Investors are looking for return and yield, and the U.S is the best option for that."
Sentiment is "more risk on than risk off," said Randy Warren, chief investment officer at Warren Financial. "The play here is that we're going to have a decent second half."
The Dow Jones industrial average closed nearly 4 point higher, well off session highs, with Walt Disney contributing the most gains. The S&P briefly erased gains in afternoon trade, as energy lagged, before closing less than a point higher. The Nasdaq composite outperformed, rising about 0.25 percent.
Stocks have held in a narrow range recently, and the CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, is trading around its lowest levels in a year. On Tuesday, the VIX traded near 11.6.