European shares fell, affected by the decline in retail and US stocks

European shares fell 1.7 percent on Thursday after heavy selling on Wall Street, as weak results from retail companies highlighted the impact of high inflation on the world’s largest economy.

European retail stocks fell, following in the footsteps of their American counterparts, by 2.4 percent and was the biggest loser on the European Stoxx 600 Index. The index extended its decline after dropping 1 percent on Wednesday.

The decline in stocks was widespread, and most of the sub-indices fell.

European retailers such as Tesco and Sainsbury’s warned last month that their full-year profits would be hit by higher prices.

Shares of Nestle, Tesco and Unilever fell between 2.7 percent and 4.5 percent on Thursday.

The Stoxx 600 index has fallen by about 12 percent since the beginning of the year, after the closures due to the Corona virus in China increased fears of a global economic recession.