European stocks finished a bit higher Monday, with gains for bank shares helping the regional benchmark eke out a nearly two-week high.

The Stoxx Europe 600 SXXP, +0.04% closed up less than 0.1% at 341.53. The pan-European index marked its best close since July 27, FactSet data showed.

The Stoxx 600 has advanced for four trading days in a row. The benchmark on Friday jumped 1.1%, continuing to gain after the Bank of England ramped up its stimulus efforts.

U.S. stocks closed lower Monday after touching record highs as Wall Street caught its breath in the wake of last week's upbeat jobs data.

The S&P 500 index SPX, -0.09% pulled back from an intraday record of 2,185.44, reached shortly after the opening bell, to close with a loss of 1.98 points, or 0.1%, at 2,180.89. The index was dragged down by a sharp drop in health-care stocks, which outweighed a rise in energy shares that accompanied strong gains for crude-oil futures CLU6, -0.81%

The Dow Jones Industrial Average DJIA, -0.08% closed down 14.24 points, or 0.1%, at 18,529.29. A 1.6% drop in shares of Merck & Co. MRK, -1.57% and a 1.4% decline in Pfizer Inc. PFE, -1.44% shares dragged the blue-chip gauge down. Oil giant Exxon Mobil Corp. XOM, +1.18% was the average's best performer with a 1.2% gain, while Chevron Corp. CVX, +0.69% shares closed up 0.7%.

The Nasdaq Composite Index COMP, -0.15% fell 7.98 points, or 0.2%, to close at 5,213.14, after logging its first closing record in more than a year on Friday, following the employment report. Earlier in the session, the index carved out a new all-time intraday high of 5,228.40.

Asian shares stood atop one-year peaks on Tuesday as investors' desperate search for yield drove a record inflow into emerging market funds, while the pound slipped to one-month lows on speculation of further policy easing in the UK.

Analysts at Bank of America Merrill Lynch noted the search for yield had led to the largest 5-week inflow on record to emerging market debt funds and the longest inflow streak to equity funds in two years.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS gained 0.1 percent, having already risen for three sessions in a row.

Japan's Nikkei .N225 was also attempting a fourth session of gains with a tentative rise of 0.2 percent, while Shanghai stocks .SSEC were flat.

The major data out in Asia was Chinese inflation for July and it caused few ripples by coming exactly as forecast at 1.8 percent ECONCN. The benign result merely confirmed there was plenty of scope for further policy easing if needed.

The need for stimulus was clear in Chinese trade flows which disappointed in July amid slack demand both at home and abroad.