Paris, June 27 - Carrefour shares sank to their lowest level in more than three years on Friday after the French supermarket retailer issued a profit warning that also dragged down its domestic rival Casino .
Carrefour shares at one point fell as much as 9.6 percent to an intraday low of 34.25 euros -- adding to a fall of around 9 percent in the stock on Thursday.
Rival Casino also fell by as much as 10.2 percent to an intraday low of 68.59 euros.
On Thursday, Carrefour cut its 2008 operating profit outlook and several brokers cut their recommendations on the stock on Friday.
"The main risk is a further deterioration of the competitive environment and macro environment in Carrefour's key markets," said Deutsche Bank, which cut its rating on Carrefour to "hold" from "buy".
Deutsche added that Carrefour's high non-food sales content exposed it more than its competitors to variations in consumer spending.
Societe Generale said it was integrating into its forecasts its worst-case scenario for the non-food segment in France for 2008 as the sector had not shown any signs of improvement in the second quarter of 2008 compared to the first.
SocGen cut its price target on Carrefour shares to 47 euros from 55 euros, while Cheuvreux also slashed its price target to 34 euros from 50 euros.
Carrefour Chief Executive Jose Luis Duran told French television LCI on Thursday evening that he was "surprised" by the market reaction.
"One must not mix up the economic environment, the current consumption climate, and the solid prospects of the group," he said.
Carrefour had no further comment on Friday afternoon.
Carrefour shares have fallen around 34 percent since the start of 2008, compared to a 30 percent decline in the DJ Stoxx European retail sector <.SXRP>.