Stocks on Wall Street were mixed on Tuesday, pausing a rally that had been propelled by positive earning results and optimism over a huge stimulus package in the world’s largest economy.

The FTSE’s All-World index crept up 0.2 per cent to set an all-time high and the tech-heavy Nasdaq Composite gained 0.2 per cent, but the blue-chip S&P 500 was 0.2 per cent lower at lunchtime in New York.

US stocks hit an all-time high on Monday following six sessions of back-to-back rises as Joe Biden’s administration kept up pressure on Congress to pass his $1.9tn stimulus plan, and the number of new coronavirus infections in the US fell to a three-month low.

Seema Shah, chief strategist at Principal Global Investors, said the high stock valuations were triggering increased scrutiny from investors about inflation.

“Given the wealth of fiscal stimulus that is likely to come in the US, as well as prospects for a surge in pent-up demand . . . investors are already grappling with the question [of] how much inflation will rise throughout this year,” she said, adding that “with equities so stretched, any inflationary concerns that leak into bond yields will make it more difficult to justify these valuations”.

The price of US Treasuries — which have sold off in recent weeks in anticipation that an economic rebound will result in higher inflation — rose slightly on Tuesday. The yield on the 10-year note fell 0.01 percentage points to 1.15 per cent.

In Europe, the region-wide Stoxx 600 index closed down 0.1 per cent, while Frankfurt’s Xetra Dax was 0.3 per cent lower and London’s FTSE 100 edged up 0.1 per cent.

Driving equities were accommodative monetary policies and fiscal plans, said Matthias Scheiber, global head of portfolio management at Wells Fargo. “We also see higher earnings expectations in industrials, materials, financials and the energy sector, which has been aided by higher commodities prices.”

Brent crude remained above $60 a barrel — the international benchmark’s highest level since January 2020 — rising 0.6 per cent to $60.96 a barrel in the afternoon.

Traders continue to bet that the crude market is tightening because of a double hit to supply from production cuts by the Opec+ group of producers and a drop in investment by oil companies. This, combined with hopes of a recovery in energy demand, helped send West Texas Intermediate above $58 a barrel this week. The US marker climbed a further 0.6 per cent on Tuesday to $58.32 a barrel.

In Asia, China’s benchmark CSI 300 rose 2.2 per cent and Hong Kong’s Hang Seng closed up 0.5 per cent.