The U.K.'s FTSE 100 reversed gains on Tuesday as losses in mining firms outpaced upbeat earnings by HSBC, Weir Group and Diageo, while BP's shares edged higher after the company raised its dividend.

The blue-chip FTSE 100 was last down 0.1% after rising 0.2% earlier in the session, while the more domestically-focused FTSE 250 midcap index fell 0.4%.

HSBC added 2.4%, touching a four-year high after Europe's largest bank raised its key performance target as its first-half profit surged more than two-fold.

The broader banks index gained 1.1%.

Weir Group jumped 4.1% to the top of the FTSE 100 after the engineering firm raised full-year revenue and profit guidance.

Industrial metal miners, however, capped gains, losing 1.0% as prices of most base metals slipped on a firmer dollar.

The beverages index added 1.7% as Diageo rose 1.9% after the world's largest spirits maker beat full-year sales forecasts.

"The market seems to be cautiously optimistic at the moment," said Christopher Peters, trading floor manager at Accendo Markets.

"It seems that the majority of companies that have reported and given (positive) rhetoric as such are seeing more positivity coming forward."

BP rose 1.7% after the oil giant increased its dividend by 10% despite missing second-quarter profit forecasts and dropping 70% from a year earlier.

Fresnillo slumped 7.2% after the miner posted a near-24% slump in half-yearly core profit.

Markets now await the Bank of England's decision on monetary policy on Thursday, with consensus tilted toward the central bank's incoming 25 basis point hike.

Investors will also keep tabs on July Manufacturing Purchasing Managers' Index (PMI) data due later in the day.

Meanwhile, a survey from mortgage lender Nationwide showed British house prices fell 3.8% in annual terms in July, the most significant drop since July 2009.