* European lenders follow U.S. banks lower, pull indices down
* U.S. yield curve flattest in decades on clouded outlook
* Strong Chinese imports help Asian stocks buck the trend (Updates with afternoon U.S. market activity)
By David Randall
NEW YORK, Nov 8 (Reuters) - Increasing concern that U.S. Republicans' plans to cut corporate taxes may not win congressional approval as early as expected weighed on American stock indexes on Wednesday, overshadowing strong economic data in Asia that sent the MSCI All World Index to a record high.
The dollar edged lower against a basket of currencies , while European shares dipped, led by a broad decline in bank stocks.
Derek Halpenny, head of global markets research at Mitsubishi UFJ in London, said he was dubious about the progress of the tax overhaul bill proposed by President Donald Trump's administration, which includes a big cut in corporate taxes.
"The initial phases of discussions within the House (of Representatives) have brought up a lot of divisions and problems. ... If the story is true that they're considering a delay of one year to the corporate tax cut, those big differences will need to be sorted," he said.
A report in the Washington Post late Tuesday said Senate Republican leaders were considering a one-year delay in implementing the corporate tax cut.
Francois Savary, chief investment officer at wealth manager Prime Partners, said the doubts over the tax issue reinforce the case for some consolidation in the market, which has been fully priced for good news.
"It's something that would impact the domestic stocks in the U.S. and would be a setback for the market in general, (and) it's more than stock-specific as people would reassess earnings growth expectations to the downside," he said.
The Dow Jones Industrial Average rose 9.27 points, or 0.04 percent, to 23,566.5, the S&P 500 gained 2.56 points, or 0.10 percent, to 2,593.2 and the Nasdaq Composite added 14.81 points, or 0.22 percent, to 6,782.59.
The U.S. two-to-10-year Treasury yield curve hit its flattest in a decade, potentially cutting into the profits of banks, which borrow money at short-term interest rates in order to lend it out at longer terms.
Such a move could also imply that investors are expecting a slowdown.
Financial stocks in the S&P 500 fell 0.6 percent, while technology stocks rose 0.35 percent, boosted by a 1.2 percent gain in Qualcomm Inc, which was upgraded by analysts after competitor Broadcom made an unsolicited $105 billion takeover bid for the company.
Benchmark 10-year U.S. Treasury notes were last down 6/32 in price to yield 2.3271 percent, from 2.307 percent late on Tuesday.
European bonds were also snared by the yield-curve flattening, with yields on long-term German bonds falling to two-month lows.
This was a reversal of the trend when Trump was elected president a year ago. Yields and stock prices jumped in late 2016 on what was dubbed the "Trumpflation" trade: a bet on rising rates, inflation and securities prices in the United States and beyond.
Analysts believe that a flattening yield curve at a time when the Federal Reserve is hiking U.S. interest rates is a sign that investors are concerned about the sustainability of economic growth and inflation in the world's biggest economy.
In the European session, the two main banking indexes suffered the most, with the euro zone index falling 0.1 percent and the Europe-wide banking equivalent also dropping 0.1 percent, dragging an index of pan-European stocks 0.05 percent lower.
The pan-European FTSEurofirst 300 index lost 0.01 percent and MSCI's gauge of stocks across the globe gained 0.14 percent.
Earlier, Asian shares wrung out another decade peak as data showed China's demand for imports remained buoyant, pushing the MSCI world equity index to a fresh high.
Beijing reported imports in October rose 17.2 percent from a year earlier, beating forecasts of 16 percent, but export growth was just under estimates at 6.9 percent.
Chinese crude imports slipped to their lowest in a year, pushing oil prices lower, although traders said the overall market remains well supported because of OPEC-led supply cuts.
U.S. crude fell 0.73 percent to $56.78 per barrel and Brent was last at $63.54, down 0.24 percent.
For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
Reporting by David Randall and Abhinav Ramnarayan; Additional reporting by Jemima Kelly and Sujata Rao; Editing by Jennifer Ablan and James Dalgleish