European Stocks to Open Flat Ahead of US GDP

European stocks were indicated to open flat to slightly higher, ahead of gross domestic product data from the US which would show how solid is the recovery of the world's biggest economy.

Sharon Lorimer

European shares edged up on Thursday, with US earnings season helping to boost confidence among investors, and Spain's Banco Santander rising ahead of its results next week.

Spain stepped up the pace of bank restructuring on Thursday, raising fresh funds from investors to help weaker banks, while savings bank La Caixa considered a shake-up that could help it raise private capital.

Spain's regional savings banks — known as cajas — have been under pressure from the Socialist government of Jose Luis Rodriguez Zapatero to find more cash from investors

Macroeconomic data on the agenda on Friday includes UK consumer confidence numbers as well as the euro zone retail purchasing managers index (PMI), both for January.

The European Central Bank releases M3 money supply data,a measure of cash readily available to spend which the European Central Bank sees as a leading indicator for inflation.

Concerns over inflation have grown in recent weeks, with European Central Bank governing council members warning that sharper rises in imported goods' prices carry an inflationary threat.

ECB president Jean-Claude Trichet reiterated on Thursday that the bank is paying close attention to rising commodity prices because of the possble knock-on effects.

UK Deputy Prime Minister Nick Clegg told CNBC in Davosthat the recent rise in inflation in the UK was "unwelcome". He stressed however that the country's plans to cut its deficit shouldn't be blown off course by the disappointing fourth-quarter GDP figures.

The World Economic Forum's gathering of CEOs and policymakers in Davos continues on Friday.