The S&P 500 set a record closing high on Thursday, finishing a fifth consecutive month of gains to extend a four-year rally.
The S&P had hovered near its record for more than two weeks, and market action next week will help determine if this is just another stepping stone for the rally, or if a long-expected pullback is in the offing.
The benchmark S&P 500 closed its strongest quarter in a year — up 10 percent.
The Dow climbed 11.3 percent and the NASDAQ gained 8.2 percent for the first three months of this year.
The new closing high “is a very appropriate punctuation for a great quarter that saw a lot of last year’s anxieties recede,” said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.
“However, this could be the start to a more realistic look at the problems that still haven’t gone away. Some degree of caution is probably still merited, with the problems in Cyprus probably only the beginning to what we could see in coming months,” he added.
The rally hit a wall in the last two weeks as the latest chapter in the eurozone crisis developed, with Cyprus nearing a default and a possible exit from the eurozone.
The S&P 500 had been in a fairly tight range, having traded within 10 points of the Oct. 9, 2007, record closing high of 1,565.15 over the previous 13 sessions.
On Thursday, the S&P 500 gained 6.34 points, or 0.41 percent, to end at a new record of 1,569.19.
The Dow industrials, which surpassed its 2007 record on March 5 and has set a series of record highs since then, ended Thursday’s session at yet another nominal closing high — at 14,578.54. For the day, the Dow rose 52.38 points, or 0.36 percent.
The NASDAQ Composite added 11 points, or 0.34 percent, to close at 3,267.52.
The gains in the first three months of the year have a very bullish history.
An analysis by Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research in Cincinnati, showed the S&P 500 has risen in the three first months of the year nine times in the past 30 years, and in each case, it has posted gains for the year.
The average yearly gain after such a start, the data showed, was 17.56 percent. An advance like that would leave the S&P 500 at about 1,676 at the end of this year.
“The key is the follow-through,” said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.
Key manufacturing numbers are expected on Monday and factory orders Tuesday, building up to yesterday’s widely followed payrolls report.
During March, the Dow gained 3.7 percent, the S&P 500 rose 3.6 percent and the NASDAQ added 3.4 percent.
Thursday marked the end of the trading week. US stock markets were closed yesterday because of the Good Friday holiday.
Netflix was the S&P 500’s best-performing stock during the first quarter, up 104.4 percent at US$189.28, followed by Best Buy, up 86.9 percent at US$22.15.