"The ECB somewhat surprised investors by leaving their current quantitative easing efforts intact. Not only did the central bank fail to extend the termination date of the program but it also did not even entertain such a change," Jeremy Klein, chief market strategist at FBN Securities, said in a note to clients.
"There was nothing new from the ECB, but Mr. Draghi basically stopped short of extending the easing program," said Peter Cardillo, chief market economist at First Standard Financial. "It seems that the rift between Germany and the ECB is showing and that could be a problem because it could potentially lead to slower economic growth."
U.S. stock futures traded mostly flat after the ECB announced its decision, before holding lower.
Investors also analyzed economic data from the U.S., with weekly jobless claims coming in 4,000 lower at 259,000. Other data released Thursday included the Energy Information Administration's release of weekly crude inventories, which showed a drawdown of 14.5 million barrels last week.
Oil prices rose sharply after the report, with U.S. crude settling 4.66 percent higher at $47.62 per barrel.
"Oil firms up here, that's going to be constructive," said Art Hogan, chief market strategist at Wunderlich Securities.
Stocks closed mixed on Wednesday as investors parsed through the Federal Reserve's Beige Book, which said modest wage growth may be coming soon.
"Central banks are pushing on a rope now. You can't get much more out of conventional or unconventional monetary policy without structural changes," Wunderlich's Hogan said.
Investors have been closely eyeing each data set, looking for clues about whether the Fed will raise interest rates in September. Market expectations for a rate hike in September were 18 percent, according to the CME Group's FedWatch tool.
"The market is just playing better poker than the Fed right now," said Tom Siomades, head of Hartford Funds Investment Consulting Group. "They know the Fed isn't going to do anything after that ... jobs report."
"The Fed is going to hold its breath until December and hope everything is OK," he said.
WTI intradaySource: FactSet
Equities have recently traded in a very tight range. The S&P had gone 42 straight sessions without closing 1 percent higher or lower on a closing basis as of Wednesday's close.
Jeff Kravetz, regional investment strategist at the Private Client Reserve at U.S. Bank, said that easy central bank policy across the globe should help stocks go higher in the near-term. "There's nothing in the way of stocks grinding higher," he said, adding he's advising clients to invest in growth-oriented sectors, such as information technology and consumer discretionary.
Meanwhile, U.S. Treasurys slid Thursday, with the two-year note yield near 0.77 percent and the benchmark 10-year yield around 1.61 percent.
Ninh Chung, head of investment Strategy and portfolio management at Silicon Valley Bank, said "We think U.S. interest rates will move higher, so we're positioning our portfolios to take advantage of that."
"When you look at the fundamentals of the U.S. economy, especially the labor market, we're very close to full employment," he said. Even if the Fed raises rates 25 basis points, I think that won't slow down the economy."
The U.S. dollar rose against a basket of currencies, erasing earlier losses, with the euro trading about 0.1 percent higher at $1.125 and the yen holding 0.8 percent lower, near 102.43.
Overseas, European stocks traded lower, with the Stoxx 600 index falling about 0.3 percent. In Asia, the Nikkei 225 dropped 0.32 percent and the Shanghai composite rose 0.13 percent.
The Dow Jones industrial average closed 46.23 points lower, or 0.25 percent, at 18,479.91, with Nike leading decliners and Chevron the top advancer.
The S&P 500 slipped 4.86 points, or 0.22 percent, to close at 2,181.30, with information technology leading seven sectors lower and energy the top riser.
The Nasdaq dropped 24.44 points, or 0.46 percent to close at 5,261.
Decliners were a step ahead of advancers at the New York Stock Exchange, with an exchange volume of 827 million and a composite volume of 3.599 billion at the close.
Gold futures for December delivery settled $7.60 lower, at $1,341.60 per ounce.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 12.2.
On tap this week:
*Planner subject to change.
7:45 a.m. Boston Fed President Eric Rosengren
10:00 a.m. Wholesale