Europe Markets

Commodity bounce fails to spark Europe markets

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European stocks finished firmly in the red on Tuesday, as strong performances in oil, mining stocks and sterling failed to electrify markets.

The pan-European STOXX 600 wavered throughout trade, ending down 0.79 percent provisionally. Most sectors closed in negative territory; however basic resources ended up 1.3 percent.

On the bourses front, the U.K.'s FTSE 100 fell 0.68 percent, as sterling rose against the dollar. Meanwhile, France's CAC 40 closed 0.83 percent down and Germany's DAX slipped 0.58 percent.

What's shaking up markets?

European investors took their lead from a shaky trading session in Asia on Tuesday, despite all three major indexes in the U.S. closing at record highs on Monday. On Tuesday, U.S. stocks were trading lower around 4.30 p.m. London time, as earnings and economic data took center stage.

A main area of focus for investors worldwide — particularly in the U.S. — this week is the U.S. Federal Reserve. On Wednesday, the Federal Open Market Committee is set to release the minutes from its July meeting, with analysts hoping this will provide some insight as to why it held off from raising interest rates over the summer.

In Europe, official inflation data out of the U.K. helped lift markets temporarily on Tuesday, with the biggest rise in consumer prices seen this July since November 2014. This came amid warnings the U.K.'s vote to leave the European Union could stoke inflation.

Inflation was 0.6 percent higher on July 2015, beating analyst expectations. Following the news, sterling rallied against the dollar, trading some 1 percent up at $1.3000 around Europe's close.

On the oil front, prices turned higher on Tuesday afternoon, amid speculation that leading producers would take action to prop up the market. Crude futures had come under pressure earlier after U.S. economic data revealed that consumer prices remained unchanged in July. At Europe's close, Brent and U.S. crude posted gains of 1 percent-plus each, hitting $48.92 and $46.40 respectively.

Miners outperform; Linde jumps 11%

European mining stocks were key movers on Tuesday, with basic resources outperforming other sectors. The main focus within the sector was BHP Billiton, which reported a record $6.4 billion annual loss on Tuesday, hurt by a dam disaster in Brazil and the commodity slump. Shares of the miner posted sharp gains during trade, as underlying profit was better than forecast, but pared them later in the session.

Meanwhile, Chilean copper miner Antofagasta reported a rise in first-half core earnings and said full-year capital expenditure would be lower than previous guidance, sending shares close to the top of the STOXX 600, finishing up 8.6 percent.

ArcelorMittal jumped over 3 percent, after Moody's changed its outlook on the stock from "negative" to "stable".

Aside from the miners, Linde shares rallied over 11 percent after Reuters reported that U.S. industrial gases maker Praxair was in talks to buy its German peer.

Meanwhile, British manufacturing firm Rotork fell over 2 percent after HSBC cut its price target for the stock. E.ON also closed in the red, after UBS cut its price target and reduced its rating from "buy" to "neutral".

Schindler fell to the bottom of the STOXX 600, ending 4.4 percent down after it cut its top-end guidance for revenue growth for 2016 on a weak elevator market in China and Latin America. Autos also under-performing the broader market on Tuesday, with Renault, Peugeot Citroen and Ferrari all closing down more than 2 percent each.

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