Hennes & Mauritz AB shares fell as much as 4 per cent in Stockholm on Friday, equating to about US$1.3 billion in market capitalization, as fears of a lockdown in the clothing retailer’s biggest market rattled stock investors.

Germany is H&M’s largest market in terms of sales accounting for more than 15 per cent of group revenue. The country is no longer ruling out a similar move to Austria, which has again imposed a nationwide lockdown following a renewed wave of the coronavirus pandemic.

The developments in Austria and potentially in Germany are “clearly bad for sentiment in H&M,” Nicklas Skogman, an equity analyst at Handelsbanken, said in an interview.

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