-Merrill Lynch says Europe needs policies to boost economic recovery
-Europe's trade surplus misses estimates
-ECB President criticises currency 'chatter'

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European equities ended the week mixed following a stern warning that the future of the 17-nation bloc's economy rests on reforms.

Bank of America Merrill Lynch economists said the Eurozone will fail to recover from the 2008 financial crisis unless policies boost investment and productivity.

The financial advisor said the economic downturn has impacted European investments and its potential to grow.

The trend growth for Europe's large countries - Germany, France, Italy and the UK - fell from 2.2% in 1995 to 2007 to 0.1% on average in 2008 to 2014.

"In the absence of a considerable boost to economic policy, but assuming a standard recovery, Europe's large countries trend growth would be lower at circa 1.3% in 2015-2020," Lynch said.

Separate data revealed a trade surplus for the Eurozone in December that was less than the consensus analysts' expected.

The trade surplus came in at €11.7bn compared to €13.1bn forecasts. Imports declined by 6.0% while exports fell 3.0% in December.

Citi strategist for Spain Jose Luis Martinez Campuzano said the Eurozone continues to show indications that the recession may be more persistent than expected.

ECB President slams currency 'chatter'

European Central Bank (ECB) President Mario Draghi criticised the recent "chatter" surrounding currency wars at the G20 meeting in Moscow.

"Currency chatter is inappropriate, fruitless and self-defeating," he said.
He reiterated that the Eurozone monetary authority did not consider the exchange rate to be one of its policy targets.

Draghi also insisted that the euro was not overvalued as it remains near long-term averages.

Fellow ECB Council member and Bundesbank President Jens Weidmann said an appreciation in the euro would be insufficient to trigger rate cuts.

He backed Draghi's opinion that the recent rise in the single currency is justified by economic fundamentals.

Anglo gains on earnings rise

PPR shares rose after the company's so-called recurring operating income jumped 19% to €1.79bn.

Anglo American advanced after beating analysts' predictions in its annual results, reporting full-year earnings per share of $2.26 and earnings before interest, taxes, depreciation, and amortisation of $8.69bn.

Aker Solutions fell as the oil- services provider reported fourth-quarter net income of 504m kroner, missing forecasts.

The London Stock Exchange tumbled after weak underlying earnings from its takeover target LCH Clearnet raised fresh concerns over the deal.

Other asset classes fall

The euro/dollar dropped by 0.07% to the 1.3354 level.

Front month Brent crude futures slid by 0.993 to the 116.840 dollar level on the ICE.

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