US stocks slipped as a four-week rally encouraged investors to take profits, but McDonald's better-than-expected July sales pushed up the Dow component, briefly lifting the index to a positive territory.

The Dow Jones industrial average fell 32.12 points, or 0.34 percent, closing at 9,33.95. The Standard & Poor's 500 Index lost 3.38 points, or 0.33 percent, ending at 1,007.10. The Nasdaq Composite Index slipped 8.01 points, or 0.4 percent, and closed at 1,992.24.

European shares fell after hitting their highest close in more than nine months on Friday, as miner Rio Tinto came under pressure in the China spy case and Volkswagen led the auto sector lower.

The FTSEurofirst 300 of top European shares closed 0.6 percent lower at 944.64 points. Volumes on the pan-European index were about 69 percent of its 90-day daily average volume.

The Nikkei average hit its highest close in 10 months on Monday, buoyed by stronger-than-expected US jobs data and a report that Mitsubishi Chemical was in talks to acquire resin maker Mitsubishi Rayon.

In light trade, the benchmark Nikkei rose 1.1 percent or 112.17 points to 10,524.26, its highest finish since October 3.

Japan's machinery orders, a leading indicator of capital spending, rose in June for the first time in four months, helping shares such as Komatsu Ltd, though Japanese manufacturers forecast a sixth straight quarterly fall in orders in July-September.