U.K. stocks closed lower Monday, with shares in retailers and home builders losing ground and helping to pull back London's blue-chip benchmark from the prior session's record high. The FTSE 100 index UKX, -0.36% fell 0.4% to end at 7,696.51 after Friday's finish at a record. Last week, the benchmark rose 0.5%.

The S&P 500 and the Nasdaq closed at records on Monday as gains in energy and industrials helped the benchmarks finish in positive territory in the first five sessions of 2018 on optimism over a stronger economy and looming fiscal stimulus.

Asian stocks continued their start-of-year rally Tuesday, though Japanese equities pulled back late morning after the Bank of Japan trimmed the size of its bond-repurchase offer in its latest market operation. The 5% reduction to ¥190 billion ($1.7 billion) of bonds maturing in 10-to-25 years was a sign of slight policy tightening by the central bank, and sent the yen jumping.