* World stocks up 4pct for qtr, 3rd quarterly gain in row
* Wall Street flat after disappointing jobless claims
* Crude up 24 pct for qtr -- best performing major asset
* Yen hits 10-month low vs euro
(Recasts first paragraph)
By Barani Krishnan
NEW YORK, March 31 (Reuters) - Stocks on major world
markets hit a three week high Thursday, heading for a quarterly
gain of 4.0 percent, while the euro rose on expectations the
ECB will raise interest rates in April despite the euro zone
crisis.
Shares on Wall Street were little changed as U.S. weekly
claims for new jobless benefits fell less than expected,
prompting investors to wait out Friday's monthly employment
report. For more see []
"Claims are going in the right direction, and that gives us
hope that we'll see a good employment number tomorrow," said
Jerry Harris, president of asset management at Sterne Agee in
Birmingham, Alabama.
"Today will be quiet as people have already established
their positions in preparation for a report that is expected to
be positive tomorrow," Harris said.
World stocks, as measured by MSCI All-Country World Index
<.MIWD00000PUS>, advanced 0.3 percent, on track for a 4.0
percent gain for the first quarter, the third straight
quarterly rise.
MSCI emerging markets index <.MSCIEF> rose for the third
day, up almost 1.0 percent and were on track to gain 1.6
percent for the first quarter, recovering losses from earlier
this year when investors shifted their money to developed
market equities on concerns over inflation in developing
countries.
U.S. stocks' key Dow Jones industrial average <> was
up 6.36 points, or 0.05 percent, at 12,356.97. But the Standard
& Poor's 500 Index <.SPX> was down 0.29 points, or 0.02
percent, at 1,327.97. The Nasdaq Composite Index <> was
also down, losing 0.68 points, or 0.02 percent, to stand at
2,776.11.
"(Jobless) claims are going in the right direction, and
that gives us hope that we'll see a good employment number
tomorrow," said Jerry Harris, president of asset management at
Sterne Agee in Birmingham, Alabama.
The week has been marked by some of the year's lowest
volumes as traders opt to ride the quarter's gainers amid
global risks. The S&P 500 is up 5.6 percent in the quarter,
based on Wednesday's close.
Stocks on Wall Street also contended with slightly negative
news from investment group Berkshire Hathaway.
David Sokol, the man widely seen as the leading successor
to Warren Buffett to head up Berkshire Hathaway <BRKa.N>
<BRKb.N>, resigned after buying shares in chemical company
Lubrizol Corp <LZ.N> before pushing Buffett to acquire it.
In an interview on CNBC, Sokol said he did nothing wrong in
buying the shares. [] []
Microsoft Corp <MSFT.O> stepped up its rivalry with Google
Inc <GOOG.O> on Thursday by filing a formal complaint with the
European Commission, claiming Google systematically thwarts
Internet search competition. []
EURO ZONE DEBT CRISIS INTENSIFIES
The euro zone debt crisis intensified with news of
Portugal's troubles and ahead of the publication of Irish bank
stress tests.[][] []
Portugal's budget deficit reached 8.6 percent of gross
domestic product in 2010, above a target of 7.3 percent agreed
with Brussels, statistics agency INE said on Thursday.
The yield premium that investors demand to hold Portuguese
rather than benchmark German bonds rose to 508 basis points, 12
bps wider on the day, as the country's 10-year yields
<PT10YT=TWEB> hit a fresh euro lifetime high of 8.476 percent.
Despite the debt crisis, the European Central Bank has
signalled it could raise its benchmark interest rate next week
to curb inflation, a message that has kept the euro strong
against other currencies.
The yen fell to a fresh 10-month low versus the euro and
touched a three-week trough against the U.S. dollar as
expectations grew that Japan would lag the euro zone and U.S.
central banks in raising interest rates. So far this year, the
euro has risen nearly 8.0 percent against the yen.
CRUDE OIL UP 2.0 PCT
In commodity markets, London's Brent crude <LCOc1> was on
its way to becoming the best performing major asset for the
quarter with a quarterly gain of 24 percent -- its highest in
almost two years. Crude oil prices jumped about 2.0 percent in
both London and New York <CLc1> on Thursday as traders made a
final aggressive push for profit before the quarter-end, after
more than a week of lethargic trading. []
In the bond market, U.S. Treasuries prices rose on the
slightly disappointing jobless claims data. There was some
flight-to-safety bid also as Portuguese government bond yields
hit fresh euro lifetime highs as the country missed a budget
target after another credit ratings downgrade. []
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Asset returns in Q1 2011 graphic:
http://r.reuters.com/wur78r
Key events in Q1 2011 timeline:
http://r.reuters.com/saj68r
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(Additional reporting by Ellen Freilich and Caroline
Valetkevitch in New York; and Dominic Lau in London)
