European shares fell on Monday as luxury group Richemont slumped on weaker-than-expected organic sales growth and lacklustre economic growth in China raised concerns about demand from the world’s second-biggest economy.

The pan-European STOXX 600 index was down 0.3% by 8:02 GMT, with luxury giants at the forefront of the selling pressure.

Shares of the world’s second-biggest luxury firm Richemont dropped 8.0% and were set for their sharpest one-day percentage fall in over a year after weakness in the Americas weighed on first-quarter organic sales growth.

European shares close slightly lower

“Up until now, consumption in the U.S. has held up remarkably well, despite the aggressive tightening from the Fed. The Richemont results suggest we are starting to see this curtailment in spending,” said Stuart Cole, chief macroeconomist at Equiti Capital.

Shares of other luxury giants such as LVMH, which is Europe’s most valuable company, Hermes and Kering shed between 1% and 3.7%.

The personal and household goods index, housing luxury firms, was the biggest sectoral loser, down 2.2%. Further hurting sentiment on Monday, data signalled China’s economy grew at a frail pace in the second quarter on weaker demand, raising pressure on policymakers to deliver more stimulus.

“We are left with a picture of both U.S. and Chinese consumption slowing, and the market is responding to this double whammy of bad news by marking down stock prices,” said Cole.

The mining sector was the second biggest decliner, down 1.4%, as concerns about demand from top consumer China weighed on metal prices.

The benchmark STOXX 600 index logged its biggest weekly percentage gain since the end of March in the previous week on hopes the Federal Reserve could wind up its rate hike cycle soon after July, given cooling U.S. inflation.

However, analysts have cautioned that other major central banks, particularly the Bank of England, have further to go in terms of tightening.

Earnings are also a big focus, with heavyweights such as Tesla expected to issue results this week, after big U.S. banks kicked off the second-quarter results season on Friday.

Shares in Banco BPM rose 2.1% after the Italian bank entered a payments deal with private equity fund FSI.

The move helped the banks sub-index gain 0.5%, while healthcare shares also helped limit losses on the STOXX 600.

Argenx SE jumped 26% to the top of the benchmark index on positive results from its neurological disorder drug study.