The passage of Donald Trump's tax-cut plans through the Senate over the weekend helped boost the dollar.

London (AFP) - Wall Street stocks touched new record highs early Monday following the Senate passage of a massive and long-awaited tax cut plan.

Elsewhere, European stock markets rallied and Asian indices diverged as traders watched a Brussels summit on Brexit and digested news that a former aide to Donald Trump had agreed to co-operate with a probe into Russian election interference.

“US stocks are adding to last week’s strong gains in early action, with Saturday’s passing of the Senate’s tax reform bill boosting optimism…” said analysts at Charles Schwab brokerage.

The blue-chip Dow Jones Industrial Average hit a record of 24,534.04 points before giving up some of the gains. The broader S&P 500 index set a new record high at 2,665.19 points.

After marathon talks in Washington lawmakers finally passed controversial reforms to the tax system, which the president says will fire up the world’s number one economy.

- Door open for stimulus -

“The US dollar began the week on the front foot after the… tax plans were approved, opening the door to a vast fiscal stimulus for the US economy”, noted Neil Wilson, senior market analyst at ETX Capital.

The greenback strengthened against the yen and the euro, though dealers remain reticent as both houses of Congress must reconcile their differing bills before sending a final draft to the White House, while analysts also warned of political risk.

“If the legislation gets ratified quickly, there would likely be another dollar bounce, but the longer this drags out, the dollar will probably sell off as political uncertainty has been the greenback’s undoing over and over again in 2017,” said Stephen Innes, head of Asia-Pacific trading at OANDA.

The dollar’s advance helped to boost the share prices of European exporters.

The DAX 30 in Frankfurt jumped 1.5 percent and the CAC 40 in Paris climbed 1.4 percent.

A strong pound limited the gains to London’s FTSE 100 to 0.5 percent.

The pound gained against the dollar for much of the day as British Prime Minister Theresa May appeared to be closing in on sealing a deal on divorce terms with EU chiefs and making progress towards resolving the thorny issue of the Irish border.

It fell back after European Commission President Jean-Claude Juncker said Britain and the EU did not reach “complete agreement” on Brexit divorce terms during talks in Brussels on Monday.

Earlier in Asia, Hong Kong ended higher but there were falls for Tokyo and Shanghai.

Oil prices were down after Friday’s rally in reaction to a decision by crude producers to extend a period of production limits.

Bitcoin meanwhile reached a fresh all-time high Monday, at $11,845.33, after a US regulator cleared the way for futures in the unit to trade on major exchanges.

The Chicago Mercantile Exchange – the world’s biggest futures exchange – has said it will launch futures contracts on December 17.

“The fact that CME – the biggest kid on the block – is moving early into cryptocurrency will force other major exchanges to follow suit in the fear of not missing out,” said Shane Chanel at ASR Wealth Advisers.

The unit has risen 15-fold since the start of the year.

- Key figures around 1630 GMT -

London - FTSE 100: UP 0.5 percent at 7,338.97 points (close)

Frankfurt - DAX 30: UP 1.5 percent at 13,058.55 (close)

Paris - CAC 40: UP 1.4 percent at 5,389.29 (close)

EURO STOXX 50: UP 1.3 percent at 3,573.89

New York - DOW: UP 0.9 percent at 24,451.93

Tokyo - Nikkei 225: DOWN 0.5 percent at 22,707.16 (close)

Hong Kong - Hang Seng: UP 0.2 percent at 29,138.28 (close)

Shanghai - Composite: DOWN 0.2 percent at 3,309.62 (close)

Euro/dollar: DOWN at $1.1852 from $1.1898 at 2200 GMT

Pound/dollar: DOWN at $1.3472 from $1.3477

Dollar/yen: UP at 112.74 yen from 112.12 yen

Oil - Brent North Sea: DOWN 87 cents at $62.86 per barrel

Oil - West Texas Intermediate: DOWN 67 cents at $57.69