Italian financial markets closed slightly higher Tuesday and the spread with German bonds narrowed amid new optimism on the outlook for Europe\'s economy. Other European markets also ended the day higher after European finance ministers, meeting in Brussels, expressed confidence that Greece will succeed with its bond repurchase program, an important step in efforts to staunch its debt crisis. Sentiment was also optimistic that eurozone finance ministers will meet their year-end deadline to set up a joint supervisor at the European Central Bank. Talks ended without resolution Tuesday, but markets are hopeful a deal will be reached in the coming weeks. In Milan, the FTSE Mib gained 1.04%, to close at 16,041 points, just above the psychological threshold of 16,000 points. The spread between Italy\'s benchmark 10-year bond and its German counterpart closed trading Tuesday at 303 basis points, just above the psychologically important mark of 300 points, with a yield of 4.42%. The reduction in the spread between Italian and German benchmark bonds is a sign of new-found market confidence in the euro and in Italy, Italian Economy Minister Vittorio Grill said earlier in the day. The drop in the spread \"is due to a combination of factors, the European Union and Italy are honouring their commitments and so there is a positive judgement by the markets which have renewed confidence in the euro and in Italy,\" he said in Brussels. Premier Mario Monti has said his aim is to bring the spread down to 287 basis points, exactly half what it was in November 2011 when he was brought in to replace Silvio Berlusconi and salvage the struggling economy. Meanwhile, in Frankfurt the Dax ended the day unchanged, at 7,435.12 points while in Paris, the CAC 40 index gained 0.39% to close at 3,580.48 points. However, London\'s FTSE-100 index slipped by 0.04% to close lower at 5,869.04 points while Madrid\'s Ibex 35 index gained 0.17% to close at 7,902.40 points.