European stocks dropped almost across the board on Tuesday, with banks leading the charge lower after a broker downgrade and concerns over a potential early election in Italy. Renewed concerns that Greece may not make its next debt repayment also weighed on investor sentiment in Europe.

U.S. stocks closed moderately lower Tuesday as energy shares weighed on Wall Street, helping to halt a seven-session streak of advances for the S&P 500 and Nasdaq Composite. However, the overall slump in equities didn't prevent a record-setting performance by a handful of technology shares. Overall, market activity was muted following the three-day weekend in observance of Memorial Day, with trading volume relatively light.

Asian stocks climbed on Wednesday, capping a fifth consecutive month of gains, as data showed China's factory activity grew at a steady clip this month, bucking expectations of a slowdown.