* Dollar rises for fifth straight session
* China 2019 growth target 6 to 6.5 pct vs 6.5 pct in 2018
* Beijing pledges tax cuts, more spending and lending (Updates with close of European markets)
By Chuck Mikolajczak
NEW YORK, March 5 (Reuters) - A gauge of world stock markets recovered from early lows to inch higher on Tuesday as China cut its growth targets to a 30-year low but added more stimulus, while strong U.S. economic data put the dollar on track to notch its fifth straight day of gains.
Stocks on Wall Street traded in a similar fashion, with the benchmark S&P 500 just above the unchanged mark as investors looked for developments on trade between the United States and China. Positive retail earnings from Target and data on the U.S. services and housing sectors helped provide support to the upside.
“Even though (China) have cut their growth forecast, the market is still holding its own, that is a positive. The implication is investors are expecting some sort of trade agreement to be signed, which could then be beneficial,” said Sam Stovall, chief investment strategist at CFRA Research in New York.
The Commerce Department said sales of new U.S. single-family homes rose to a seven-month high in December while a reading from the Institute for Supply Management showed an acceleration in growth in the vast services sector in February.
The S&P 500 index has struggled to hold above the 2,800 level, which has proven to be a stiff resistant point. Still, the index is up nearly 19 percent from its Dec. 24 low.
“There is an old saying that round numbers are like rusty doors and require several attempts before finally breaking open,” said Stovall.
European shares bounced between modest gains and declines, eventually closing slightly higher in the wake of China’s response to the lowered growth target of between 6.0 to 6.5 percent for 2019, which includes billions of dollars in planned tax cuts and infrastructure spending and a lack of news on the trade front.
The Dow Jones Industrial Average rose 33.65 points, or 0.13 percent, to 25,853.3, the S&P 500 gained 2.09 points, or 0.07 percent, to 2,794.9 and the Nasdaq Composite added 19.62 points, or 0.26 percent, to 7,597.19.
Fatigue after a strong run higher for equities is playing a role in the recent pause. MSCI’s All Country World Index shed 0.05 percent, but has now risen about 15 percent from its near two-year closing low on Dec. 24. The index is trading at 14.6 times expected earnings, on par with levels back in early October, when a global bear market began to take hold.
The pan-European STOXX 600 index rose 0.27 percent.
In currency markets, the greenback was lifted by the economic data and is now up nearly 0.9 percent over the past five sessions.
The dollar index, tracking the unit against six major currencies, rose 0.16 percent, with the euro down 0.29 percent to $1.1304.
Oil prices were little changed as the market wavered on expectations for an imminent trade deal between the United States and China while awaiting U.S. government crude stocks data.
U.S. crude rose 0.09 percent to $56.64 per barrel and Brent was last at $65.97, up 0.46 percent on the day.
Additional reporting by Medha Singh; Editing by Bernadette Baum and Dan Grebler