The Nikkei 225 was mostly flat, closing 0.02 percent or 4.72 lower at 19,677.85, while the S&P/ASX 200 reversed earlier losses to finish the session in the green. The ASX closed 0.19 percent or 10.828 points higher at 5,717.9.
South Korea's benchmark Kospi index dipped 0.39 percent or 9.29 points to close at 2,343.68, pulling back from record highs.
Markets in Hong Kong and China are closed today for a public holiday. Stateside, markets in the U.S. were closed on Monday for Memorial Day.
Shares of the Kuala Lumpur-listed Genting rose 1.5 percent after it reported first quarter earnings of 603 million Malaysian ringgit ($141 million) compared to 131 million ringgit a year ago.
Meanwhile, casino operator Genting Malaysia reported that profits in the first quarter had doubled on year. Despite that, shares of the company tumbled more than 5 percent.
The dollar/yen, which traded around 111.21 before the release of data, traded at 111.18 following the news. The yen later strengthened further to trade at 110.89 at 2:05 p.m. HK/SIN.
In other currency news, the dollar traded mostly flat against a basket of six rival currencies at 97.707. The greenback hit a near six and a half month low last week.
Meanwhile, the euro edged down to trade at $1.1119 against the dollar. This followed headlines about the Greek bailout and comments made by European Central Bank (ECB) President Mario Draghi while addressing the European Parliament yesterday.
In his speech, Draghi acknowledged growth in the euro zone but said "an extraordinary amount of monetary policy support" remained "necessary."
"It's now only a week out from the ECB meeting and you can't get much clearer than that. The ECB will then unveil its new inflation forecasts; an about turn from the ECB signalling a winding down of QE would be a big surprise to the market," National Australia Bank Senior Economist David de Garis wrote in a note.
Oil prices were mixed after ending the last session cautiously higher following reports of U.S. drillers adding rigs. Brent crude shed 0.27 percent to trade at $52.15 a barrel while U.S. West Texas International (WTI) crude added 0.06 percent to trade at $49.83.
Correction: This article has been updated to accurately reflect the changes in the dollar, the euro, the yen and the pound.
Europe markets close lower as political concerns weigh
Banking stocks were among the worst-performing sectors following remarks by ECB (European Central Bank) President Mario Draghi and a Deutsche Bank research note. Both stated that European banks no longer had support from a valuation perspective, and growth in the euro area is set to fade.
Specifically, Italian banks were under pressure as concerns over an upcoming election intensified. Banco Bpm led the losses in this sector as its shares contracted more than 2.3 percent.
The telecoms sector was also moving below the flatline. Proximus dropped more than 2 percent following a downgrade by Raymond James.
Looking at individual stocks, International Airlines Group fell nearly 2.5 percent. This is after an IT crash at British Airways disrupted flights over the bank holiday weekend.
Elsewhere, Akzo Nobel dropped almost 2 percent after a Dutch court supported the firm's dispute with Elliott Management. The U.S. firm is said to be disappointed and considering its "next steps".
Meanwhile, in the U.S., the Dow Jones industrial average and broader S&P 500 index both continued trading slightly lower as investors assessed a slew of fresh economic data after a holiday weekend.
Politics and data
Meanwhile, former Italian Prime Minister Matteo Renzi said over the weekend that it seemed appropriate – from a European point of view – for the nation to hold its next election at the same time as Germany, with the latter set to take place in September 2017.
In terms of data, euro zone businesses seemed less upbeat about the outlook for their companies in May, despite the outcome of the French election. The European Commission's economic sentiment indicator dropped to 109.2 in May from 109.7 in April.
Stocks close lower as S&P and Nasdaq snap 7-day winning streak
The Dow Jones industrial average fell about 50 points, with Goldman Sachs contributing the most losses.
The Nasdaq composite traded 0.1 percent despite shares of Amazon breaking above $1,000 for the first time. The S&P 500 slipped 0.1, with energy leading decliners, but the information technology sector rose 0.31 percent. Tech has been on fire this year, rising around 20 percent. Nevertheless, the Nasdaq and S&P snapped a seven-day winning streak.
"The large tech outperformance is a trend I wouldn't fight right now," said Mark Heppenstall, CIO at Penn Mutual Asset Management, but noted, "there's a lot of good news priced into these stocks."
U.S. stock markets were closed Monday because of the Memorial Day holiday.
Personal income rose 0.4 percent in April, in line with expectations, and consumer spending increased by 0.4 percent. The personal consumption expenditures price index, the Federal Reserve's preferred measure of inflation, rose 0.2 percent.
"The series stubbornly has not risen to anywhere near the FOMC's preferred level of inflation. Despite ostensibly failing to satisfy half of its Dual Mandate, the central bank will have few problems progressing down the path to normalization," said Jeremy Klein, chief market strategist at FBN Securities.
Meanwhile, U.S. home prices rose 5.8 percent in March, according to the S&P/Case-Shiller U.S. National Home Price Index.
"The economic data support the narrative that we have a solid fundamental backdrop," said Art Hogan, chief market strategist at Wunderlich Securities. "What we need here is progress on the [Trump] agenda."
President Donald Trump returned from his first trip overseas to deal with the fallout from reports that Jared Kushner, his son-in-law and a top adviser, discussed the potential to set up a "secret and secure communications channel" between the Trump transition team and the Kremlin.
Stocks came into Tuesday's session having posted strong gains in the previous week. Those gains propelled the S&P and Nasdaq indexes to record levels.
"What's driving the market here is the fact that interest rates have been so low lately," said Bruce Bittles, chief investment strategist at Baird. "Everyone thought interest rates were going up but the opposite has happened."
The benchmark 10-year note yield began 2017 trading near 2.5 percent but hovered near 2.22 percent on Tuesday.
Dallas Fed President Robert Kaplan told CNBC on Tuesday he sees U.S. growth to remain near 2 percent and not the 3 percent or more forecast by President Donald Trump's administration.
"Two things drive GDP: growth in the labor force and growth in productivity," he said in a live interview on "Squawk Box." "The problem is labor force growth is very sluggish. And my own judgment and our economists at the Dallas Fed think it's going to continue to be sluggish the next 10 years because the population is aging and labor force growth therefore is slowing."
The S&P 500 slipped 2.91 points, or 0.12 percent, to end at 2,412.91, with energy leading seven sectors lower and telecommunications the biggest advancer.
The Nasdaq declined 7 points, or 0.11 percent, to close at 6,203.19.
About nine stocks declined for every five advancers at the New York Stock Exchange, with an exchange volume of 770.36 million and a composite volume of 3.186 billion at the close.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 10.4.
—CNBC's Jeff Cox contributed to this report.
On tap this week:
What to Watch
Earnings: Michael Kors, J. Jill, Hewlett Packard Enterprises, Palo Alto Networks, Box, Vera Bradley, Analog Devices
8:00 a.m. Dallas Fed President Rob Kaplan
9:45 a.m. Chicago PMI
10:00 a.m. Pending home sales
2:00 p.m. Beige book
7:30 p.m. San Francisco Fed President John Williams
May vehicle sales
Earnings: Dollar General, Lululemon Athletica, VMWare, Broadcom, Workday, Five Below, Yext, Cooper Cos, Express, Ciena, Mobileye
8:15 a.m. ADP employment
8:30 a.m. Initial claims
8:30 a.m. Productivity and costs
9:45 a.m. Manufacturing PMI
10:00 a.m. ISM manufacturing
10:00 a.m. Construction spending
8:30 a.m. Employment
8:30 a.m. International trade