This is CNBC's live blog covering European markets.

European stock markets closed lower Tuesday as market participants followed the latest U.S. debt ceiling developments.

The pan-European Stoxx 600 index provisionally ended 0.9% lower, with most sectors and major bourses in negative territory.

Food and beverages stocks led the losses, down 2.7%, while utilities stocks rose 0.8%.

European trading was muted on Monday with U.K. markets and some bourses as well as U.S. markets closed for holidays.

A group of Republican lawmakers on the party's hard right said Monday they would oppose the deal reached by President Joe Biden and House Speaker Republican Kevin McCarthy over the weekend.

Political manoeuvring will be needed to get the bill through the Republican-controlled House of Representatives and Democratic-controlled Senate before the June 5 deadline, but U.S. politicians have expressed confidence it will do so.

Antonio Cavarero, head of investments at Generali Insurance Asset Management, told CNBC on Monday he did not expect a "major relief rally" following the deal since the scenario was mostly priced in.

"It is possible the market over the next few days will focus on the execution risk. They need to find the votes, this might trigger the attention of the markets for a couple of days," Cavarero said.

Elsewhere in the political sphere, Spain's Prime Minister Pedro Sanchez called for an early general election to be held on July 23 after his ruling Socialist party suffered heavy losses in regional elections.

The Turkish lira continued to slide on Tuesday, marking a fresh record low after incumbent President Recep Tayyip Erdogan secured reelection.

Asia-Pacific stock markets were mixed Tuesday. U.S. stock futures were higher after Memorial Day.

Oil prices fall 3%

Oil prices extended losses on Tuesday afternoon as traders monitored the latest developments regarding the U.S. debt ceiling and looked ahead to a forthcoming meeting between an influential alliance of crude producers.

International benchmark Brent crude futures fell 3% to $74.83 a barrel at 2:10 p.m. London time, while U.S. West Texas Intermediate futures slipped 2.8% to $70.64.

President Joe Biden and Republican lawmakers over the weekend tentatively reached a deal on raising the debt ceiling, with Congress set to vote on the legislation as early as Wednesday. Several weeks of tense negotiations had raised the prospect that the U.S. could default on its debt obligations, potentially disrupting financial markets.

Elsewhere, OPEC and non-OPEC producers, an energy alliance known as OPEC+, will hold a production policy meeting on June 4 amid a recent slump in prices.

— Sam Meredith

Stocks on the move: Aroundtown, Embracer Group up, QinetiQ slips

Shares of European real estate group Aroundtown got a 5% boost Tuesday morning after the company's first quarter results reaffirmed its full-year guidance of €300 million ($321.6 million) operating profit.

That was despite a €21.6 million net loss reported for the period, during which property sales and negative valuation effects have weighed. The firm's shares have lost nearly 80% over the last year.

Stock of Swedish gaming group Embracer was up 4% in the wake of last week's share price plummet. Its share price has more than halved in May, when the company slashed its full-year 2023-24 earnings forecast because of delayed releases and revealed the loss of a $2 billion partnership deal.

At the bottom of stock movements, shares of defense tech firm QinetiQ dipped 3.5%. Last Thursday, the company said it was looking at acquisition opportunities after reporting sharply higher full-year profits and record orders.

— Jenni Reid

Central banks will keep hiking rates until economy slows, SocGen economist says

Kokou Agbo-Bloua, global head of economics, cross-asset and quant research at Societe Generale Corporate and Investment Banking, discusses central banks' monetary policy tightening efforts and their potential impact on the economic and market outlook.

Europe stocks choppy

European stocks were mixed in morning trade, with the Stoxx 600 index moving between narrow losses and gains.

Investors are watching key votes on the U.S. debt ceiling and more clues from central banks on the path of interest rates.

Germany's DAX index was up 0.25% by mid-morning, though France's CAC 40 and the U.K.'s FTSE 100 declined by 0.5% and 0.14%, respectively .

— Jenni Reid

UK shop prices rise at record rate

U.K. shop price inflation in May reached the highest level since records began in 2005, according to snapshot figures from the British Retail Consortium.

Supermarket and retail chain price inflation was 9% year on year, up from 8.8% in April. Food price inflation came down slightly, from 15.7% to 15.4%.

BRC chief executive Helen Dickinson said lower energy and commodity prices were starting to be felt in food staples.

The U.K. government said Monday the prime minister and finance minister were meeting food sector representatives to see what could be done about the cost-of-living pressure on consumers, but stressed they were not looking to impose any compulsory price caps.

Headline consumer price inflation was 8.7% in April, the joint highest in the Group of Seven developed economies alongside Italy.

— Jenni Reid

European markets: Here are the opening calls

European markets are set for marginal gains at Tuesday's open.

The U.K.'s FTSE 100 index was last seen opening 3.8 points higher at 7,624, according to data from IG.

Germany's DAX is set to open 11.5 points higher at 15,962, France's CAC up 1.2 points at 7,266 and Italy's FTSE MIB 14.9 points higher at 26,647.

— Jenni Reid

CNBC Pro: Parts of the market are getting pricey. But analysts like these 4 cheap stocks

Markets have rallied this year despite economic uncertainty in the United States.

Some parts of the markets are expensive right now, but analysts say some sectors are still cheap.

They name four stocks that are still cheap to buy, including one in tech.

CNBC Pro subscribers can read more here.

— Weizhen Tan

CNBC Pro: Nvidia and A.I. are hot — and BofA says these 3 global stocks are also worth the buzz

Nvidia's earnings blockbuster has gotten investors excited.

In a May 25 note, BofA said Nvidia's "rosy outlook" when it comes to data centers and artificial intelligence has reaffirmed its positive view on the AI server hardware supply chain.

It named three global stocks to play the Nvidia and AI buzz.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Biden, Congressional leaders iron out debt ceiling agreement set for a vote this week

President Joe Biden and Congressional leaders reached an initial agreement on over the weekend to avoid a U.S. default, with the bill set for a vote as soon as this week.

House Majority Speaker Kevin McCarthy and Biden had been at odds for weeks over raising the debt ceiling, with the first inklings of real progress coming last week. Key provisions that necessitated compromise included keeping non-defense spending flat for the next two years as well as increasing work requirements of food stamp benefits.

Still, the bill will need both Republican and Democratic support to make it to President Biden's desk before the so-called "X date" on June 5, which is the earliest time the Treasury Department has signaled the U.S. could default.

— Brian Evans