Stock Market Today: Stocks Edge Higher, Remain on Track for 4th Week of Gains

NEW YORK (TheStreet) -- U.S. stocks drifted higher early Friday afternoon in one of the slowest trading days of the year ahead of the three-day Labor Day weekend. Equities remained on track for their fourth straight weekly gain, bolstered by good economic data and speculation about European Central Bank stimulus.

The Dow Jones Industrial Average   rose 0.03% to 17,084.45. The S&P 500 was up 0.23% to 2,001.27. The Nasdaq  ticked up 0.37% to 4,574.36.

Watch the video below for a look at how U.S. markets are doing in midday trading Friday:

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Traders are betting on renewed economic stimulus from the ECB in the coming weeks following weaker eurozone data. A month-on-month fall of 1.4% in German retail sales in July and continuing falls in Spain, coupled with wholesale price declines in France for industrial and food products, all point to a further decline in inflation. The flash reading of 0.3% for the eurozone consumer price index from Eurostat seemed to confirm that trend. A spate of poor economic figures from Japan, which is still trying to pull itself out of its decade-long deflationary slump, added to the pressure for the eurozone bank to act before Europe enters a similar swoon.

"If the ECB does refer to quantitative easing, that means more liquidity in the world markets as well. In retrospect we benefit from that in terms of easy money," said Peter Cardillo, chief market economist at Rockwell Global Capital.

Denting sentiment somewhat, the U.K. raised its terror threat level to "severe" in response to intensifying armed conflict in Syria and Iraq.

Read More: Aug. 29 Premarket Briefing: 10 Things You Should Know

Generally upbeat U.S. economic numbers on Friday added to the positive surprises of Thursday's results. The final reading on the Reuters/University of Michigan consumer sentiment index for August provided an upward revision to 82.5, beating expectations of 80.2. Even though the latest consumer spending number disappointed, readings on consumer confidence keep improving. 

The Chicago PMI jumped to 64.3 in August from 52.6 in July. U.S. personal income rose 0.2% in July, slightly less than the consensus 0.3%, the Bureau of Economic Analysis reported before the market open. Consumer spending fell 0.1%.

The S&P is now on track for its biggest monthly gain since February, in many ways a surprise considering the escalation of geopolitical concerns the market was focused on at the beginning of the month. "All of a sudden, those concerns were placed on the sidelines as the economic data continued to show the economy improving. It certainly turned out to be a heck of a lot better than we expected," Cardillo remarked.

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