CAC 40 Retreats As Growth Worries Intensify

French stocks fell sharply on Thursday after U.S. retail giants Target and Walmart missed earnings expectations by wide margins and issued back-to-back profit warnings, raising concerns over downside risks to growth.

It is feared that high inflation and the Fed’s tightening monetary policy may weigh on corporate profit margins and consumer spending.

The benchmark CAC 40 dropped 114 points, or 1.8 percent, to 6,283 after declining 1.2 percent the previous day.

Selling was seen across the board, with AXA, Airbus, ArcelorMittal, BNP Paribas, Capgemini, Danone, Essilor Luxottica, Pernod Ricard, Renault and Saint Gobain losing 2-3 percent.

Asian markets followed Wall Street lower and U.S. stock futures pointed to steep losses later in the day as investors fret over the prospects of an inflation-fueled recession.