European stocks drifted following a mixed session in Asia and the dollar climbed as investors awaited the US inflation report for clues on the pace of Federal Reserve policy-tightening. Treasury yields edged higher and oil slipped.

The Stoxx Europe 600 Index traded little changed after six days of gains. Earlier, Japanese stocks fluctuated before closing higher, while Hong Kong and Chinese shares slipped. Australian equities slid, weighed by banks and miners. Futures for the S&P 500 rose. The yen weakened as investors digested the political fallout from a scandal embroiling Japanese Finance Minister Taro Aso. The US 10-year yield inched up to 2.88 per cent after Monday's Treasury auction was broadly in line with expectations.

All eyes will be on the US inflation data as traders try to second guess the path of monetary tightening in the world’s biggest economy. A figure that misses or meets estimates is likely to reaffirm the case for three rate hikes this year and give the green light to fresh appetite for risk assets.

Politics also remain in focus after President Donald Trump issued an executive order blocking Broadcom from acquiring Qualcomm, scuttling a $117 billion hostile takeover that had been the subject of scrutiny over the deal's threat to US national security.