Elections in France and Greece over the weekend turned out incumbents who favored fiscal discipline over stimulus spending. In Greece, sentiment against an international rescue deal that came with severe spending cuts has changed the face of Parliament enough so that some analysts are predicting that Greece's days in the eurozone are numbered.
Stocks were mixed in Asia, but hard hit in most of Europe. The CAC 40 index in France was down 2.78 percent. In Italy, the FTSE MIB index fell 2.37 percent. The DAX index in Germany lost 1.9 percent.
By close of trading on Wall Street, the Dow Jones industrial average shed 76.44 points, 0.59 percent, to 12,932.09, a climb from earlier losses of 143.61 points or 1.1 percent.
The tech-heavy Nasdaq composite index closed down 11.49 points or 0.39 percent, to 2,946.27. The Standard & Poor's 500 index gave up 5.86 points, or 0.43 percent, to 1,363.72.
On the New York Stock Exchange, 1,190 stocks advanced and 1,830 declined on a volume of 4 billion shares traded.
The 10-year benchmark treasury note rose 11/32 to yield 1.843 percent.
The euro fell to $1.3003 from Monday's $1.3051. Against the yen, the dollar fell to 79.88 yen from 79.89 yen.
In Tokyo, the Nikkei 225 index gained 0.69 percent, 62.51, to 9,181.65.
In London, the FTSE 100 index lost 1.78 percent, 100.51, to 5,554.55.