GLOBAL MARKETS-Stocks head for 4 pct quarterly rise; euro up

                                

                                
 * World stocks set for third straight quarter of gains
                                
 * Wall Street flat after U.S. jobless claims
                                
 * Crude up 24 pct for quarter -- best performing asset
                                
 * Yen hits 10-month low vs euro
  (Updates prices)
                                
 By Barani Krishnan
                                
 NEW YORK, March 31 (Reuters) - Stocks on major world
markets hit a three-week high on 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 debt crisis.
                                
  Shares on Wall Street were flat 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 [.N]
                                
 "Claims are going in the right direction," 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.
                                
  By 11:40 a.m. (1540 GMT), the Dow Jones industrial average
<.DJI> was down 6.85 points, or 0.06 percent, at 12,343.76. The
Standard & Poor's 500 Index <.SPX> was down 2.13 points, or
0.16 percent, at 1,326.13. The Nasdaq Composite Index <.IXIC>
was down 5.14 points, or 0.19 percent, at 2,771.65.
                                
 Wall Street has seen some of the year's lowest volume days
this week 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.
                                
 World stocks, as measured by MSCI All-Country World Index
<.MIWD00000PUS>, were up 0.1 percent, on track for a 4.0
percent gain for the first quarter -- their third straight
quarterly rise.
                                
 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. [ID:nN30189928] [ID:nN31227596]
                                
 Microsoft Corp <MSFT.O> stepped up its rivalry with Google
Inc <GOOG.O> by filing a formal complaint with the European
Commission, claiming Google thwarts Internet search
competition. [ID:nN31223364]
                                
 MSCI emerging markets index <.MSCIEF> rose for the third
day, up almost 1.0 percent and on track to gain 1.6 percent for
the first quarter, recovering losses from earlier this year.
                                
 ECB MULLS RATE HIKE
                                
 The euro zone debt crisis intensified with news of
Portugal's troubles and ahead of the publication of Irish bank
stress tests.[ID:nLDE72U17E][ID:nWLA6919] [USD/]
                                
 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 investors demand to hold Portuguese bonds
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 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 10-month low of 117.90 versus the euro
and touched a three-week trough of 83.21 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 1.6 PCT
                                
 In commodity markets, London's Brent crude oil <LCOc1> was
on its way to becoming the best performing major asset for the
quarter with a quarterly gain of about 24 percent -- its
highest in almost two years. Oil was up 1.6 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. [O/R]
                                
 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. [US/]
                                
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  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; Editing by
Kenneth Barry)