Tiffany & Co. (TIF) cut its full-year earnings forecast Tuesday after sales growth weakened in the U.S. and Europe during the holiday season, raising fears that economic uncertainty might be reining the demand of luxury shoppers and cutting the jewelry retailer's shares.

For its fiscal year ending Jan. 31, Tiffany now estimates earnings per share of $3.60 to $3.65, below its boosted November forecast of $3.70 to $3.80 a share.

Tiffany tumbled 11.67 percent, or $7.81, to $59.13 at 11:21 in New York. The shares rose 6.4 percent in 2011.

After achieving very strong and better-than-expected sales and earnings growth in the first three quarters of 2011, sales weakened markedly in the United States and Europe during the holiday season, reflecting restrained spending by consumers for fine jewelry, Chief Executive Michael Kowalski said.

The retailer reported worldwide net sales rose 7 percent to $952 million for the two months ended Dec. 31, which was slower than the 11 percent gain Tiffany recorded in the same year-ago period.

In the Americas region, which includes the U.S., Canada and Latin America, sales rose 4 percent to $503 million. The region saw a 9 percent increase a year earlier. Higher sales to tourists from outside the U.S. were partly offset by weakness in spending by U.S. customers. The New York flagship store sales declined 1 percent.

Sales in the Asia-Pacific region increased 19 percent to $165 million. And in Japan, sales increased 13 percent to $160 million.

Tiffany expects to report its financial results for the fourth quarter and year ending Jan.31, 2012, on March 20.

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