Stock markets rise
New York's tech-heavy Nasdaq and the broad S&P 500 indices moved confidently higher out of the gate, though the Dow was struggling.
London's FTSE, the CAC 40 in Paris and the DAX in Frankfurt were all trading higher, reversing dives a day earlier.
The picture in Asia was mixed, though, with Shanghai closing higher but Hong Kong and Tokyo losing ground.
The transatlantic bounce was different from Monday, when European indices closed in the red and US ones were muddled in the wake of the EU-US trade deal announced on the weekend.
'The fact that markets have bounced back today suggests investors have been buoyed by hopes that the US-EU trade accord might draw a line under recent uncertainty, offering European businesses a clearer path forward,' said Fawad Razaqzada, market analyst at FOREX.com.
Still, on the currency market, the euro extended losses against the dollar, indicating that European disgruntlement at the trade deal had not gone away.
The euro has 'suffered a nasty battering... as investors questioned just how positive the US-EU trade deal was for the European Union', said David Morrison, senior market analyst at Trade Nation.
Earning reports
Tuesday's focus was now more on company earning reports that are raining down this week in the United States and Europe, with tech heavyweights in the spotlight.
Meta and Microsoft were to give results on Wednesday, with Amazon and Apple following on Thursday.
The massive investment race in artificial intelligence was informing much of the action.
Bloomberg News reported that Microsoft was in talks to keep access to OpenAI technology, even if the ChatGPT maker achieves AI that goes beyond human intelligence.
Meta, meanwhile, has opened its pockets wide to grab AI talent -- including several OpenAI employees -- to build out its own artificial intelligence operations.
Amazon and Apple are also competing, though the latter is seen to be badly lagging so far.
Thomas Mathews, a markets analyst at Capital Economics, said a continued rally in US stocks 'may depend especially heavily on 'big tech' profit results continuing to paint a positive picture, especially around AI'.
'With the worst of the risks around trade seemingly fading, we suspect there are fewer remaining obstacles to further investor enthusiasm for AI and its implications for US companies,' he said.
London's FTSE was boosted in particular by heavyweight AstraZeneca after the drugmaker posted strong earnings.
Shares in eyewear giant EssilorLuxottica jumped more than 6% on strong second-quarter results, topping the Paris CAC 40 index.
Swedish music streamer Spotify's shares slid 7% after it reported an operating profit that far missed its target.
The US Federal Reserve, meanwhile, was to begin Tuesday its two-day policy meeting under increasing pressure from President Donald Trump to slash rates, despite stubbornly high inflation.
Oil prices extended Monday's rise after Trump shortened a deadline for Russia to end its war in Ukraine to August 7 or 9, following which he vowed to sanction countries buying its crude.
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