L'Oréal fell sharply on the stock market on Friday due to disappointing sales in Asia, as its travel retail business continued to feel the effects of new regulations on the parallel resale market in China.

On the Paris Bourse at around 08:10 GMT, the share price plunged 6.06% to 425.65 euros, compared with a 0.1% decline for the CAC 40 index.

On Thursday, L'Oréal reported a 6.9% rise in sales to 10.61 billion euros in the fourth quarter, a slower increase than in the previous quarter.

The figure was also slightly below expectations at 10.9 billion euros, according to estimates quoted by Barclays.

The French group's traveler sales activities, particularly in Hainan and South Korea, were penalized by the Chinese government's crackdown on the parallel resale market known as Daigou.

Resellers buy stock at lower prices on other markets in order to resell it on the mainland.

"North Asia and the luxury (segment) fell well short of expectations, and we believe that the headwinds in China are structural and not just cyclical," writes Deutsche Bank in a note.

(Written by Claude Chendjou, edited by Kate Entringer)