(Reuters) - Disappointing corporate earnings handed European shares their biggest daily decline in over a week on Tuesday and left U.S. stocks little changed, while Iran's seizure of a cargo ship in the Gulf lifted oil prices.

In U.S. markets, shares of handbag and accessories maker Coach slumped 6.1 percent, while Ford Motor slipped 1 percent in premarket trading. Results from both companies fell short of estimates.

"Most of the big corporations are missing on revenue and eventually that's going to hurt the markets as valuations stay high," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

European shares tumbled following some weaker-than-expected corporate updates, with paper maker UPM-Kymmene slipping after results while a new share issue hit Commerzbank. The FTSEurofirst 300 gave back Monday's gains and was on track for its biggest one-day decline since April 17.

Oil prices rose. Iranian forces boarded a Marshall Islands-flagged cargo ship in the Gulf on Tuesday, the Pentagon said.

Brent crude was last up 26 cents at $65.09 a barrel. U.S. crude was last up 10 cents at $57.09 per barrel.

Investors also traded cautiously at the start of the Federal Reserve's two-day policy meeting. Analysts expect recent soft U.S. data will nudge the U.S. central bank toward a dovish monetary policy, while investors will scrutinize statements for hints about the timing of a rate hike.

The dollar index, which measures the greenback against a basket of major currencies, fell to an eight-week low of 96.011 after the Conference Board said its index of consumer attitudes fell to 95.2 from an upwardly revised 101.4 in March. Economists were looking for a reading of 102.5.

"The current period of dollar weakness appears to be gaining momentum and accordingly likely has further to run," said Camilla Sutton, chief currency strategist at Scotiabank in Toronto. "A test of another 1 percent in dollar weakness is likely in the near-term."

The Dow Jones industrial average was last up 28.36 points, or 0.16 percent, at 18,066.33. The S&P 500 was up 1.22 points, or 0.06 percent, at 2,110.14. The Nasdaq Composite was down 2.24 points, or 0.04 percent, at 5,058.01.

MSCI's all-country world stock index, which tracks shares in 45 nations, was down 0.21 points or 0.05 percent, to 441.96. Chinese shares eased off a new seven-year high, which also hurt the MSCI index's performance.

Europe's broad FTSEurofirst 300 index dropped 1.64 percent to 1,615.77.

Safe-haven U.S. Treasury yields rose after stronger-than-expected home price data in February from S&P/Case-Shiller signaled resilience in U.S. housing sector. Benchmark 10-year U.S. Treasury notes were last down 9/32 in price to yield 1.96 percent, from a yield of 1.92 percent late Monday.

Spot gold prices rose $10.25 or 0.85 percent, to $1,211.80 an ounce.

By Reuters