EUROPE MARKETS: European Stocks Rise Ahead Of Key Euro-zone Inflation Data

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- European stock markets climbed on Friday, partly recovering from a Ukraine-spurred selloff the prior day, with investors waiting for the closely watched euro-zone inflation figures.

Economists expect consumer-price growth in the currency to have slipped to 0.3% in August, which would be a step closer to deflation. A weak reading could add more pressure on the European Central Bank to either cut interest rates or launch a quantitative-easing program at its monetary-policy meeting next week. Read: Why you should care about Friday's euro-zone inflation data

ECB President Mario Draghi spurred hopes for more easing in the euro zone last Friday when he at the Jackson Hole meeting struck a dovish tone and hinted at a full-on QE program in efforts to fight of the threat of deflation.

The data come out at 10 a.m. London time, or 5 a.m. Eastern Time. At the same time, July unemployment data for the currency bloc are also due.

Market reaction: Ahead of the releases, the Stoxx Europe 600 index climbed 0.3% to 342.11. The pan-European benchmark was on track for a 1.8% advance in August, which would mark the first monthly gain since May.

Germany's DAX 30 index gained 0.3% to 9,489.13, while France's CAC 40 index was up 0.2% at 4,376.39.

The U.K.'s FTSE 100 index added 0.1% to 6,813.63, with Tesco PLC capping gains for the benchmark after a profit warning.

The euro (EURUSD) traded at $1.3171 ahead of the inflation data.

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