Swiss watchmaker Swatch issued an apology at the weekend and pulled ads featuring images of an Asian male model pulling the corners of his eyes up and backwards in a “slanted eye” pose.

The images for the Swatch Essentials collection were widely condemned online in China, where many said they appeared to mimic racist taunts about Asian eyes.

Shares in the company fell as much as 4% on Monday before paring losses to trade 3.1% lower at 1420 GMT.

“It is very significant for a brand of that scale to misfire in this way,” said Mark Borkowski, who runs a public relations consultancy in London. “This carelessness is really quite a fundamental mistake.”

In an apology posted in both Chinese and English on its Weibo social media platform on Saturday, Swatch said it had “taken note of the recent

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