London's Financial Times-Stock Exchange 100 index fell 21.9 points, or 0.41%, to 5,322.3, following a report that the July consumer price index rose 0.1%, more than expected, which pushed the year-on-year rate to 2.3%.
Germany's DAX index fell 38.53 points, or 0.78%, to 4,883.81. Among the gainers, industrial gases group Linde was up on a report that the company is preparing a defense against a takeover, while Commerzbank rose on a report that CEO Klaus-Peter Mueller won't step down because of a money-laundering probe.
In Paris, the CAC 40 index dropped 22.01 points, or 0.49%, to 4,444.57. Carrefour was higher after J.P. Morgan Chase raised its rating on the stock to overweight from underweight. France Telecom gained after Credit Suisse First Boston reiterated its outperform rating and raised its price target.
Asian markets ended mixed Tuesday.
Japan's Nikkei 225 index closed up 59.12 points, or 0.48%, to 12,315.67, which is the first time since August 2001 the index has closed above 12,300. Gains on Wall Street overnight helped fuel positive sentiment, as stocks of domestically oriented companies extended recent gains on the back of a brighter outlook for the economy.
In Hong Kong, the Hang Seng index closed down 22.44 points, or 0.15% to 15,443.62 amid profit-taking after recent market gains, according to Standard and Poor's MarketScope.