By Victor Reklaitis, MarketWatch , Ryan Vlastelica
ECB leaves rates unchanged
U.S. stocks inches higher on Thursday, setting the Nasdaq up for a fifth straight daily gain as concerns eased over the prospect of tariffs setting off a trade war, although there were few positive catalysts seen that could boost shares decisively over the near term.
President Donald Trump is expected to sign a decree that lays out his plan for levies on steel and aluminum imports this week, perhaps as soon as 3:30 p.m. Eastern Time on Thursday. While the prospect of tariffs have spurred volatility in recent sessions, reports indicate the plans may spare major trading partners Canada and Mexico , which could limit the potential for any retaliation.
What are the main benchmarks doing?
The Dow Jones Industrial Average rose 26 points, or 0.1%, to 24,822. The S&P 500 rose 2 points to 2,718, a gain of 0.1%. The Nasdaq Composite Index rose 15 points, or 0.2%, to 7,411. The tech-heavy index has closed up in each of the four past sessions.
All three indexes dipped into negative territory in morning trading, though they subsequently bounced back. The Dow is up 0.5% for the year as of Wednesday's close, while the S&P has gained 2.1% and the Nasdaq Composite has tacked on 7.4%. The three gauges stand below all-time highs set in late January, but they've also rallied from lows reached in early February, when investors were increasingly nervous about an uptick in inflation and rising interest rates.
What's driving markets?
Issues surrounding trade have driven market action in both directions over the past week. Investors are concerned that an escalation of protectionism, or retaliation by trading partners could threaten U.S. economic growth. For example, European Union has lined up retaliatory action if the Trump administration imposes levies on its products.
In an interview on Bloomberg TV, J.P. Morgan(>> company sheet) boss Jamie Dimon said tariffs were "the wrong way" to go about tackling trade problems.
Trade fears have weighed on markets this month, and the late Tuesday resignation of pro-trade White House adviser Gary Cohn added to the uncertainty. The Dow down 0.8% so far in March, while the Russell 2000 , an index of small-capitalization stocks that is seen as having less exposure to this issue , is up 3.7% over the same period.
Check out:MarketWatch's Economic Calendar
However, there are a number of positive factors that continue to support equities outside of the trade issue, including growing corporate profits and improving economic data. In the latest economic data, jobless claims rose by 21,000 in the latest week , rebounding off their lowest level since 1969.
No Federal Reserve officials are scheduled to speak Thursday. The European Central Bank left interest rates unchanged but removed language from its statement saying it would boost the size of its asset purchases if conditions deteriorated. The move was widely described as a small step toward ending the ECB's quantitative easing program later this year.
Live blog recap:ECB decision and Mario Draghi's conference
What are strategists saying?
"The tariffs are driving volatility in the short term, but it seems like it is more about politics than a fundamental policy change, given the reports that Mexico and Canada could be exempt. We think the likelihood of a full trade war are low, and that any market dips are a buying opportunity," said Abe Sheikh, co-chief investment officer of Cougar Global. Cougar is an affiliate of Carillon Tower Advisors, which has $65 billion in assets.
"Valuations are on the high end, though they're somewhat justified by earnings growth. However, we're especially careful about investing in markets that have bigger downside risk."
What are other assets doing?
European stocks were mostly rising for a fourth session in a row. Asian markets closed higher .
Check out:Here's the case for a hawkish tweak to the ECB's policy guidance
Gold futures and oil futures lost ground as the ICE U.S. Dollar Index rose 0.4% . The yield on the 10-year U.S. Treasurys fell 3 basis points to 2.86%.
Which stocks look like key movers?
Shares in Express Scripts Holding Co.jumped 12% after health insurer Cigna Cosaid it plans to buy the pharmacy-benefits manager in a $67 billion deal . Cigna's stock fell 10%.
Supermarket operator Kroger Co. sank 11% after it reported its fourth-quarter results .
Rent-A-Center Inc. rose 9.5% a day after it announced layoffs and said it was reviewing "strategic and financial alternatives " to maximize stockholder value, including evaluating the sale of the company.
American Eagle Outfitters Inc. tumbled 9.6% despite reporting strong-than-expected revenue and raised its dividend .
Shares in Costco Wholesale Corp.(>> company sheet) fell 1.7% a day after it posted better-than-expected revenue along with earnings that were boosted by the U.S. tax overhaul
Also late Wednesday, newspaper publisher Tronc Inc.reported earnings that missed forecasts , sending shares down 22%.
Casino operator Caesars Entertainment Corp. swung to a quarterly profit , sending shares up 3.8%.