Stocks diverge, as US inflation puts focus on Trump's tariffs
New York was generally trading higher on the back of healthy results from major US banks and buoyant news in the tech sector.
The S&P 500 and Nasdaq were up, though the Dow Jones was struggling.
Most Asian indices rose but Europe's stock markets slipped into the red late in the day.
The US consumer price index for June showed an acceleration to 2.7 percent from a year earlier, in line with economists' forecasts.
"The CPI release showed some early signs of tariff pass-through but underlying inflation remains muted," said Stephen Innes, managing partner at SPI Asset Management.
While US inflation remained relatively tame, analysts said businesses were working through stockpiles amassed in anticipation of Trump's duties and further price rises could be expected later this year.
Since April, the United States has imposed a baseline 10-percent tariff on goods imported from almost all trading partners, with steeper levies on steel, aluminium and cars.
Trump has threatened 30-percent tariffs on European Union and Mexican goods from August 1 if they do not cut trade deals.
The US Federal Reserve, which has an inflation target of two percent, could cut rates in September -- but not if the tariffs also end up putting a brake on US economic growth.
China, which has negotiated a US tariff truce, issued economic growth data that met expectations, largely thanks to an April-June export surge to get ahead of Trump's levies.
But the US president on Monday warned of new tariffs of up to 100 percent on Russia's trading partners -- which include China -- if Moscow does not end its war on Ukraine within 50 days.
Even though Russia is a major crude producer, oil prices dropped after Trump's announcement and continued lower on Tuesday.
"Investors seem convinced that the 50-day window gives the US, Russia and Ukraine an opportunity to hammer out some kind of deal," said David Morrison, senior market analyst at Trade Nation.
- OPEC forecast -
OPEC said in its latest monthly market report it expected its production forecasts for this year and next to hold, despite uncertainties generated by the US tariffs.
It forecast that oil demand would rise by 1.3 million barrels in 2025 and again in 2026.
"Continued robust global economic growth is expected... despite ongoing US-centred trade challenges and geopolitical uncertainties," it said.
In corporate news, US banks JPMorgan Chase and Wells Fargo posted better-than-expected second-quarter results.
JPMorgan boss Jamie Dimon described the US economy as "resilient" while facing "significant risks", including over tariffs uncertainty.
And tech darling Nvidia's share price jumped after it said US export restrictions will be eased to allow it to sell its H20 artificial intelligence chips to China.
That gave fuel to the Nasdaq, which had closed on Monday on another record high.
Bitcoin slid on likely profit-taking, after having hit a record high above $123,200 on Monday, thanks to optimism over possible regulatory changes for crypto assets in the United States.
- Key figures at around 1345 GMT -
New York - Dow: DOWN 0.3 percent at 44,329.45 points
New York - S&P 500: UP 0.2 percent at 6,283.26
New York - Nasdaq Composite: UP 0.7 percent at 20,790.24
London - FTSE 100: DOWN 0.2 percent at 8,979.87
Paris - CAC 40: DOWN 0.2 percent at 7,791.87
Frankfurt - DAX: DOWN 0.1 percent at 24,134.73
Tokyo - Nikkei 225: UP 0.6 percent at 39,678.02 (close)
Hong Kong - Hang Seng Index: UP 1.6 percent at 24,590.12 (close)
Shanghai - Composite: DOWN 0.4 percent at 3,505.00 (close)
Euro/dollar: DOWN at $1.1644 from $1.1670
Pound/dollar: DOWN at $1.3408 from $1.3428
Dollar/yen: UP at 148.55 yen from 147.77 yen
Euro/pound: DOWN at 86.86 pence from 86.88 pence
Brent North Sea Crude: DOWN 0.3 percent at $69.00 per barrel
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