By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- European stock markets advanced for a fourth-straight day Wednesday after the World Bank said growth will pick up pace in 2014.

The Stoxx Europe 600 index rallied 1% to end at 334.51, reaching the highest closing level since January 2008.

"The cyclical economic recovery is taking place and we see the market being able to withstand the easing of tapering and monetary policy, led by inflation remaining subdued, will allow equities to outperform from here on in," said Atif Latif, director of trading at Guardian Stockbrokers, in emailed comments.

"Equities still remain in the uptrend albeit at the low range of the trend and we have continued to maintain our bullish bias on the market as we see the these historical low-end valuations being mispriced," he said.

Among stock movers in the pan-European index, shares of Burberry Group PLC (BURBY) jumped 4.6% after the luxury-goods firm reported a 14% rise in retail revenue in the third quarter.

Shares of Hennes & Mauritz AB rose 2.7% after the Swedish fashion retailer said total sales climbed 10% in December.

More broadly, investors welcomed a fresh economic-growth forecast from the World Bank. The institution said it expects growth world-wide to accelerate at a rate of 3.2% in 2014, led by high-income economies as they appear "to be finally turning the corner" after the financial crisis. The estimate is higher than an earlier forecast of 3% and better than the 2.4% growth in 2013.

Asia markets closed mostly higher and the U.S. indexes traded higher, with the S& P 500 index (SPX) near its all-time high.

In Europe, the German federal statistics office Destatis said growth in the euro zone's largest economy slowed in 2013 amid the currency union's crisis. Germany's price-adjusted gross domestic product expanded 0.4% in 2013 after increasing 0.7% the previous year, Destatis said.

Germany's DAX 30 index , however, rallied 2% to 9,733.81. France's CAC 40 index rose 1.4% to 4,332.07, and the U.K.'s FTSE 100 index picked up 0.8% to 6,819.86.

Mining firms rose in London, with Anglo American PLC climbing 5.5% after UBS lifted the company to buy from neutral. Shares of heavyweight Rio Tinto PLC (RIO) added 2.7% and Glencore Xstrata PLC (GLCNF) picked up 0.7%.

Shares of Deutsche Lufthansa AG gained 4.4% to 18.54 euros ($25.19) in Frankfurt after Citigroup pointed to the German airlines as one of its top picks among European carriers and raised the target price to EUR26.50 from EUR18.

E.ON SE picked up 2.2% after HSBC upgraded the utility firm to neutral from underweight as it benefits form financial flexibility and its presence in non-EU markets.

Allianz SE rose 3.2% after Credit Suisse raised the insurer to outperform from neutral.

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