LONDON – European stock indexes opened higher on Tuesday, with risk appetite showing some recovery after Monday's sharp falls, but analysts said fears over lower growth were still weighing on markets.

Asian equities slipped to their lowest in nearly two years overnight, before trimming losses. 

A tumble in stock markets so far this month is attributed to a combination of monetary tightening by major central banks and a slowdown in economic growth.

Last week central banks in the United States, Britain and Australia raised interest rates and investors girded for more tightening as policymakers fought soaring inflation.

Although these drivers persisted on Tuesday, markets saw a slight recovery, which US stock futures suggested would continue through to Wall Street's open.

At 0752 GMT, the MSCI world equity index, which tracks shares in 50 countries, was trading flat, having touched its lowest since late 2020 earlier in the session.

Europe's STOXX 600 was up 0.8 percent, but the gain was small relative to its 6.6 percent loss so far in May.

S&P 500 futures were up around 0.8 percent while Nasdaq futures rose 1.3 percent.

Peter McCallum, interest rates strategist at Mizuho, said the bounceback was a natural correction after the previous session's falls. Traders could also be positioning themselves to take advantage of any boost to sentiment coming from Wednesday's key US consumer price index data, he said.

"If headline inflation comes in and shows that month-on-month CPI is heading in the right direction then that makes the case for potentially a more dovish Fed and hikes being priced out," McCallum said.

The dollar index was little changed, having reached a 20-year high on Monday. Meanwhile, the Australian dollar fell to its lowest in nearly two years, hurt by fears of slowing economic growth. 

Oil prices edged higher, recovering after steep declines on Monday, which were due to a combination of the stronger dollar and growing recession fears. 

European Union members could reach a deal this week on the EU Commission's proposal to ban all oil imports from Russia, France's European affairs minister said. 

European government bond yields were slightly higher, with the German 10-year yield up 1 basis point at 1.1 percent.

The US 10-year yield was at 3.0499 percent, having eased since it hit 3.203 percent on Monday – a level not seen since 2018.

Gold also went some way to recover Monday's decline, up around 0.4 percent.

Elsewhere, Bitcoin was up 5.5 percent, recovering some of its 11.6 percent Monday plunge, its biggest daily fall since May 2021. At around $31,736, the cryptocurrency has lost more than half its value since it hit an all-time high of $69,000 in November.