Stock market in first quarter: best this century?

Stock market poised Thursday to turn in its best first-quarter performance since tech bubble. Can stock market keep climbing?

By Patti Domm, CNBC Executive Editor

Stocks close out the best first quarter of this century so far Thursday, despite a long list of worries that doesn't seem to be able to hold the stock market down.

"Heading into the end of the quarter, people are anticipating money is going into equities and out of bonds, and people are trying to get there early," said Art Cashin, director of floor operations at UBS.

The Dow rose 71 points Wednesday to 12,350, just shy of the February high of 12,391. The S&P was up 8 at 1328, and is now up 5.6 percent for the quarter, its best first quarter since the more than 13 percent gain when the tech bubble was brewing in 1998. The Dow is up 6.7 percent for the quarter, its best first quarter since 1999.

"I called this the Scarlet O'Hara market. 'I'll worry about that tomorrow,'" said Cashin, noting the market is shrugging off Libya, unrest in Syria, the sovereign debt situation in Europe and the Japanese nuclear disaster.

"Instead of a flight-to-safety in the dollar, there's now a flight-to-safety in the Dow. They don't want to be in the dollar because the Fed has cheapened the dollar so they say, 'let's buy the companies that are benefiting from the cheapening dollar,'" he said.

Traders are looking ahead to the March jobs report Friday, so they are keeping a close watch on Thursday's 8:30 a.m. weekly jobless claims. Chicago purchasing managers are released at 9:45 a.m. and factory orders are released at 10 a.m. The grains market is focused on the USDA's crop planting estimates, released ahead of the market open.

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In Europe, the results of Irish bank stress tests will be released but markets are already factoring in another capital injection.

Berkshire Hathaway will also be a focus after the sudden resignation of David Sokol, believed to be the heir apparent to Warren Buffet. GNC Holdings is expected to price its IPO Thursday, the latest in a string of high profile ipos this week.

Fed Speak

More Fed speak is scheduled Thursday, after a chorus of Fed speakers in the last couple of days came out on both sides of the Fed's easy money policies. Richmond Fed President Jeffrey Lacker speaks at the Richmond Fed's fourth annual credit markets symposium at 10:30 a.m. and later meets press. Fed Gov. Daniel Tarullo speaks at the same event in Charlotte at noon.

Big on the Fed's calendar Thursday is the release of documents related to the use of the bank borrowing window during the financial crisis. The Fed has never disclosed this type of information before and was prodded to do so by the courts after a case brought by media.

"I think it's history, so I don't think it's going to make a difference (for future window borrowing). There may be a surprise or two. That's going to be interesting from a historical perspective," said Mark Zandi, chief economist at Moody's economy.com.

Of more interest to markets has been the comments from Fed officials, who are publicly debating the merits of continuing the Fed's quantitative easing program. St. Louis Fed President James Bullard, an outspoken critic of QE, said Wednesday that the Fed may need to end its extraordinary easing before the crisis in Japan and high oil prices are resolved. Earlier in the week, he said it could end $100 billion short of the intended purchase of $600 billion in Treasury securities.

Kansas City Fed President Thomas Hoenig Wednesday said the Fed needs to act now and blamed its easy policies for the run up in gasoline and food prices.

The Fed also Wednesday rejected AIG's offer to buy the mortgage-related assets in its Maiden Lane II portfolio and said it would sell the assets individually and in blocks in a competitive process.

Treasury Secretary Tim Geithner meets with global bankers at a seminar in China, to discuss ideas for revamping the global monetary system ahead of the G-20 annual meeting in France in late May.