Stocks in Europe swung to losses Tuesday, after a reading of German business confidence failed to meet expectations and underscored concerns about sluggish economic recovery in the euro zone.

The Stoxx Europe 600 index fell 0.4% to 345.10, extending a 0.5% loss from Monday that came after a report of weakness in euro-zone business activity in June.

The closely watched Ifo Institute survey released Tuesday showed business confidence in Europe's largest economy fell more than expected in June, with companies expressing concern about the impact of political crises in both Ukraine and Iraq on future business activity.

The Ifo's lead indicator was 109.7 in June, compared with expectations of a 110.2 reading among economists polled by Dow Jones Newswires. In May, the reading was 110.4.

"We clearly believe that this is a sign of worry which investors should factor in, as we already have the weaker PMI and German ZEW [economic sentiment] readings," said Naeem Aslam, chief market analyst at AvaTrade, in a note.

Germany's DAX 30 equity index lost gains and slipped nearly 3 points to 9,917.91 in the wake of the Ifo report.

Last week, Germany's ZEW economic sentiment indicator dropped to 29.8 points in June, missing a consensus projection of a 35 reading and marking a sixth straight month of declines.

Among corporate movers, Syngenta shares surged 4.4% to the top of the Stoxx 600 following a Bloomberg report that Monsanto Co. (MON) had been considering a bid for the Swiss agrochemicals maker. The deal was abandoned after Syngenta's management decided not to hold negotiations, Bloomberg reported.

BMW shares climbed 2.2% following a ratings upgrade to buy from neutral at UBS, citing near-term volume upside as one of the reasons for the move.

Among country indexes, the FTSE 100 index lost grip of gains and fell 0.3% to 6,782.92, and France's CAC 40 index clung to a rise of 2 points at 4,517.