Markets buoyant after Fed assessment

Markets were buoyant Wednesday, a day after a fairly rosy assessment of the US economy from the Federal Reserve boosted confidence about the state of the world's largest economy. A seeming calm in Europe's debt crisis following Greece's successful bond swap has also fueled the optimism, that's sent many stock indexes around the world up to multi-month highs. US markets are doing even better, trading at levels not seen since the collapse of US investment bank Lehman Brothers in 2008. The latest bout of optimism was fueled by a more positive tone from the Fed after it kept monetary policy unchanged. It also pledged to keep its key interest rate at super-low levels until late 2014. News that all but four of 19 major US banks passed a Federal Reserve "stress test" exercise and got the green light to boost dividends and take other steps that will make their stocks more attractive to investors also helped support markets. "Sentiment remains positive, aided by a neutral Fed statement, better US economic data, and US banks passing the Fed's stress test," said Neil MacKinnon, global macro strategist at VTB Capital. "Worries about the Greek debt crisis have diminished in the light of the recent restructuring and investors seem sanguine about potential knock-on effects elsewhere in the euro zone," he added. The combination of improving US economic indicators and calmer European debt markets helped most stocks continue to rise on Wednesday, a day after the Dow Jones industrial average closed above 13,000 and the broader S&P 500 index breached 1,380, widely considered a key technical level in the markets. In Europe, Germany's DAX closed 1.2 percent higher at 7,079.42 while the CAC-40 in France rose 0.4 percent to 3,564.51. Britain's FTSE 100 slipped 0.2 percent to 5,945.43. In the U., the Dow Jones Industrial Average was up 0.1 percent at 13,194.06 while the S&P 500 was flat at 1,395.31. The last time it closed above the 1,400 mark was in June 2008. The recent positive US economic news has also benefited the dollar as investors have reined in predictions of another monetary stimulus from the Fed. The euro was trading 0.3 percent lower at $1.3041 while the dollar was 0.8 percent higher at 83.65 yen. Earlier in Asia, stocks outside of China were mostly higher. Japan's Nikkei 225 index jumped 1.5 percent to 10,050.52 as the yen continued its retreat from record highs against the dollar. The last time the Nikkei closed above 10,000 was July 27. But Hong Kong and mainland Chinese shares lost ground, with property developers among the biggest decliners, after Premier Wen Jiabao said government curbs that have started to cool surging housing prices will remain in place. Hong Kong's Hang Seng Index slipped 0.2 percent to 21,307.89. The benchmark Shanghai Composite Index tumbled 2.6 percent to 2,391.23. The Shenzhen Composite Index plunged 4.1 percent to 969.12.