U.K. stocks turned lower Tuesday, clipped as the pound hit a three-week high and as investors wrestled with a downbeat report on British services activity and lingering tensions surrounding North Korea's nuclear program. The FTSE 100 UKX, -0.52% fell 0.5% to close at 7,372.92, with only the oil and gas and utilities sectors showing gains. The index had been higher early in the session as shares of miners and retailers rose.

U.S. stocks closed firmly lower on Tuesday, with the S&P 500 snapping a six-day winning streak, as investors focused on heightened tensions between the West and North Korea and worries about a lack of progress on President Donald Trump's pro-growth agenda. Low trading volume, particularly as investors returned from a holiday-lengthened Labor Day weekend, added to the downbeat tone on Wall Street.

Asian stocks fell as nations grapple with how to deal with escalating provocations from North Korea. The yen was near its strongest level for the year and U.S. Treasury yields were at their lowest since the aftermath of Donald Trump's November election win.