European Stocks Decline From 13-Month High; Irish Life Retreats

By Adria Cimino

Nov. 17 (Bloomberg) -- European stocks fell for the first time in five days after Federal Reserve Chairman Ben S. Bernanke said economic “headwinds” probably will restrain the pace of the U.S. recovery. Most Asian shares and U.S. futures declined.

Irish Life & Permanent Plc sank 7 percent after raising its forecast for loan losses through 2011. Enterprise Inns Plc slid 4.6 percent on lower profit. UBS AG advanced 1.8 percent after saying it aims to reach 15 billion Swiss francs ($14.9 billion) in annual pretax earnings in the next three to five years.

Europe’s Dow Jones Stoxx 600 Index slipped 0.2 percent to 250.97 at 9:17 a.m. in London, falling from a 13-month high. The gauge has still gained 59 percent since March 9 amid signs government spending and record-low interest rates are helping to drag the economy out of recession. U.S. stocks rallied yesterday as retail sales rebounded and Asian government leaders pledged to maintain economic stimulus spending.

Futures on the Standard & Poor’s 500 Index expiring in December declined 0.2 percent today, as did the MSCI Asia Pacific Index.

“Significant economic challenges remain,” Bernanke said in a speech yesterday to the Economic Club of New York. “The flow of credit remains constrained, economic activity weak and unemployment much too high. Future setbacks are possible.” He added that the Fed is “attentive” to changes in the dollar’s value and “will help ensure that the dollar is strong.”

Irish Life & Permanent

Irish Life & Permanent sank 7 percent to 4.10 euros. Ireland’s biggest mortgage lender said impairment provisions in the three years to 2011 will be 800 million euros ($1.12 billion) to 900 million euros. The company previously estimated provisions of 700 million euros.

Enterprise Inns retreated 4.6 percent to 127.4 pence. The U.K.’s second-biggest pub owner said full-year profit dropped 97 percent to 6 million pounds ($10.1 million) as food and drink sales tumbled in the recession. The company took a 151 million- pound charge on the value of its pubs, compared with a 53 million-pound writedown a year earlier.

UBS rose 1.8 percent to 17.8 francs. The company aims to reach 15 billion francs in annual pretax earnings in the next three to five years as Chief Executive Officer Oswald Gruebel seeks to return Switzerland’s largest bank to profit. UBS also set a goal for return on equity, a measure of profitability, of 15 percent to 20 percent in the same period, the lender said before its investor day today.

Fortis added 2 percent to 2.95 euros after the owner of Belgium’s largest life insurer reported group net income of 1.08 billion euros for the first nine months.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.