* Dollar slumps after Draghi comments
* Dow up 0.38 pct, S&P 500 up 0.06 pct, Nasdaq up 0.06 pct (Updates with Caterpillar turning lower)
By Chuck Mikolajczak
NEW YORK, Jan 25 (Reuters) - The S&P 500 was little changed on Thursday as early gains spurred by solid earnings reports and a decline in the dollar evaporated and Caterpillar shares turned negative.
Biogen Inc gained 0.66 percent after the drugmaker reported fourth-quarter revenue that beat Wall Street estimates on higher sales of recently-launched drug Spinraza.
But the early drive higher stalled as Caterpillar Inc shares turned negative after rising as much as 2.8 percent. Shares were last down 1.03 percent as investors booked profits in a stock that was up about 8 percent heading into the week.
“It opened up big and then all of a sudden it is tanking, that pulled down a lot of positive momentum in the market,” said Peter Costa, President, Empire Executions Inc in New York.
“For whatever reason, it is not going (up) anymore and people just start taking profits and pulling money out.”
Robust quarterly earnings reports and economic data have helped propel major Wall Street indexes to a strong start this year, with each on track for a fourth week of gains.
According to Thomson Reuters data through Wednesday morning, earnings growth for the benchmark S&P 500 is expected at 12.4 percent. Of the 88 companies in the index that have posted results, 78.4 percent have topped expectations, while 72 percent had done so on average in the previous four quarters.
The Dow Jones Industrial Average rose 99.44 points, or 0.38 percent, to 26,351.56, the S&P 500 gained 1.68 points, or 0.06 percent, to 2,839.22 and the Nasdaq Composite added 4.28 points, or 0.06 percent, to 7,419.34.
The European Central Bank kept its ultra-easy policy unchanged but weakness in the U.S. dollar accelerated as Draghi warned the surge in the euro was a source of uncertainty and said the bank might have to review strategy if U.S. comments on a weak dollar lead to a change in monetary conditions.
The dollar fell 0.72 percent against a basket of major currencies and held near three-year lows. A weaker dollar tends to benefit large U.S. multinational companies.
The greenback had suffered its biggest daily percentage drop in seven months on Wednesday after U.S. Treasury Secretary Steven Mnuchin said he welcomed a weaker currency.
On Thursday, Mnuchin said a weaker dollar benefited U.S. trade balances in the short term but that he believed in the long-term strength of the currency.
Weekly initial jobless claims rose to 233,000 from a downwardly revised 216,000 in the prior month, but were below the 240,000 forecast, indicating the labor market continues to tighten.
However, sales of new U.S. single-family homes fell more than expected in December, recording their biggest drop in nearly 1-1/2 years.
Ford Motor Co shares slumped 3.36 percent after the automaker posted a lower-than-expected quarterly net profit. The company’s bottom line was hurt by rising commodity costs and unfavorable currency exchange rates, and it expected more pain to come from higher raw material prices in 2018.
After the close of trading on Thursday, results are expected from Intel Corp and Starbucks Corp. (Reporting by Chuck Mikolajczak; Editing by Bernadette Baum and Nick Zieminski)