May 22 (Reuters) - Puig's shares fell around 14% on Friday after the Spanish perfumery and U.S. cosmetics maker Estée Lauder said on Thursday they had ended merger talks.

The shares were at the bottom of Europe's benchmark STOXX 600 index and could see their worst trading day since their 2024 listing if the losses hold, after the companies scrapped a merger plan that would have created a luxury beauty group worth about $40 billion.

Puig shares had rallied when the discussions became public in March, but they gave up most of those gains on Friday. Estée shares rose more than 10% in extended U.S. trading on Thursday.

J.P. Morgan said the end of the talks was likely to weigh on Puig shares, with investors' attention returning to operating results as growth in fragrances normalises and pressure persists in the Middle East and travel retail.

The market could now focus more closely on the slower sales growth shown in Puig's first-quarter update in April, the brokerage added in a note to clients.

Puig will remain focused on executing its strategy, it said in Thursday's statement, adding that its capital structure would give it flexibility for selective mergers and acquisitions. The company declined to comment further when contacted by Reuters.

The company had been due to hold its Capital Markets Day on April 14, but postponed the event due to the ongoing negotiations. The market is now awaiting a new date for the event and the company's new strategic plan.