Equity markets took a hit on Monday after the attacks wiped out nearly half of Saudi Arabia's oil production, sending oil prices soaring and fuelling geopolitical tensions.
But investors were calmed after US President Donald Trump said he did not want war and Reuters reported that Saudi Arabia was close to restoring 70% of its lost production.
"People were thinking it would be months until we got that production back on line, and now it seems more like weeks. Putting that production back on line alleviates the risk of a higher disruption," said Keith Buchanan, a portfolio manager at GLOBALT Investments in Atlanta.
The S&P energy index dipped 1.6% after recording its strongest one-day surge since January on Monday. The so-called defensive consumer staples, utilities and real estate posted some of the biggest gains among the 11 major S&P sectors.
Overall, six sectors rose and five fell.
The US Federal Reserve concludes its two-day policy meeting on Wednesday, where the central bank is expected to lower interest rates by a quarter percentage point, the second rate reduction of the year.
The S&P 500 bank index, which tends to underperform in a lower interest rate environment, fell 0.2%.
At 2:30 pm ET, the Dow Jones Industrial Average was down 0.06% at 27,060.17 points, while the S&P 500 gained 0.01% to 2,998.34.
The Nasdaq Composite added 0.09% to 8,160.91.
Among stocks, Chipotle Mexican Grill Inc jumped 3.2% as it added a new steak dish to its menu in the United States for the first time in three years.
Home Depot Inc dropped 0.7% after Guggenheim downgraded the home improvement chain's shares to "neutral" from "buy".