Tepper, who manages the roughly $15 billion fund company Appaloosa Management, has been optimistic on U.S. stocks since several years ago, when he became known for embracing the "Bernanke put" theory that the Federal Reserve's quantitative easing would pave the way for a bull run.
Since then, he's been proved right, most recently with a particularly huge rally in the S&P last year that helped his flagship hedge fund generate 30 percent returns, and a strong start to 2013, in which the index has risen nearly 9 percent and his fund is up more than 10 percent, according to the person familiar with his thinking.
Reached yesterday, Tepper was reluctant to speak out about his outlook, saying the quarter wasn't yet over and it was too early to discuss returns. "We are still constructive on the market," he told CNBC.
According to the person familiar with his thinking, Tepper believes that the economy in the U.S. is strong, and is expecting gross domestic product growth of about 2.25 percent for the first quarter.
Investors seem to be shrugging off the recent spate of government budget cuts known as sequestration, and the economic picture in Europe appears to be stable. Unless there's an unexpected downturn in Europe, Tepper believes, the stock rally in the U.S. should persist, according to the person familiar with his thinking.
Appaloosa has benefited from the S&P's returns, with its Palomino fund showing a strong January of about 6 percent returns. The firm's flagship fund was flat for February, said the person familiar with Tepper's thinking, but March is off to a very strong start.
One bright spot for Tepper has been the airline stocks he holds, including United Continental (UAL), Delta (DAL), and US Airways (LCC), all of which are up by double digits year to date. Outside the U.S., Appaloosa has gained from investments in Japan, as well as the upsurge in the Nikkei stock index, adds the person familiar with Tepper's thinking.