European stocks closed lower Monday as shares in Bayer AG and Fiat Chrysler Automobiles NV struggled and Deutsche Bank sounded downbeat on the market. Markit said its eurozone composite purchasing managers index fell to 52.9. Economists surveyed by The Wall Street Journal last week had expected a rise to 53.2.

U.S. stocks surged to close higher Tuesday as a rally in financial and technology shares underpinned a sharp, broadly based stock-market advance. Similarly, Tuesday's gain was the largest percentage gain for the index since March 11. Among the S&P 500 shares, nearly a fifth were up more than 2%, another 40% were up more than 1%, while less than 10% were in negative territory.

Asian stocks rose, with the regional equities benchmark gauge rebounding from a seven-week low, after a surge in U.S. home sales fueled speculation the world's biggest economy can withstand higher interest rates. A report showed U.S. new-home sales in April surged to the highest level in more than eight years. Odds for a Federal Reserve rate increase in June rose to 34 percent from 4 percent last Monday, with traders now expecting a better-than-even chance of an increase by July.

Based on MarketWatch materials