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Diamond Shares Sparkle in Bullish 2016

Jan 1, 2017 6:01 AM   By Joshua Freedman
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RAPAPORT...
Jewelry and diamond mining stocks gained in 2016, riding the wave of resurgent financial markets in the last two months of the year.

The strong performance mirrored the Dow Jones Industrial Average, which leapt 13 percent for the year, climbing to record highs just short of the 20,000 landmark after Donald Trump won the presidential election in early November.

U.S. jewelry-related stocks rose as consumer confidence improved toward the end of the year, with Birks Group, Sotheby’s and J.C. Penney showing the biggest gains among the retailers covered by Rapaport News. Blue Nile shares were lifted after the online jeweler was the subject of a surprise private-equity takeover in November. Signet Jewelers bucked the trend, as its shares plummeted after allegations of diamond swapping surfaced in May. 

While U.S. retail shares were largely in line with the Dow, Far East jewelry stocks outperformed the local market with double-digit increases for the year. Hong Kong-based Chow Tai Fook spiked in November following promising results that showed profit fell at a slower pace than before. Shares in Chow Sang Sang and Luk Fook also rose even as the Hang Seng Index slipped 0.9 percent for the year. 

In contrast, European retail was mixed amid political upheaval, the negative impact of terror threats and weaker demand for Swiss watches. Shares in Damiani, Richemont and Swatch Group declined, while those in LVMH Moët Hennessy Louis Vuitton and Kering gained.

Shareholders in India, however, saw little positivity as the government’s demonetization policy damaged liquidity, sending most gem and jewelry stocks tumbling.

The mining sector was arguably the biggest winner in 2016, as sales rose significantly amid a recovery in rough demand. ALROSA was the standout performer among the pure-play diamond mining stocks. Lucara Diamond Corp. benefited from a strong appetite for its exceptionally large rough diamonds, while Petra Diamonds raised its production volume. Mountain Province, Stornoway Diamond and Firestone Diamonds each attracted investors by commencing production at new mines.

Diversified mining companies also had a strong year, profiting from the overall rebound in commodities. De Beers parent Anglo American and Rio Tinto jumped significantly, outpacing the FTSE 100’s 13 percent upswing.

Here are the full results of industry stocks tracked by Rapaport News:

  Dec. 29, 2016 (12:24 GMT) Dec. 29, 2015 (11:00 GMT) Change Change
Stock Indexes        
BSE 26,366.15 26,079.48 286.67 1.1%
Dow Jones 19,833.68 17,528.27 2,305.41 13.2%
FTSE 7,101.91 6,282.01 819.90 13.1%
Hang Seng 21,790.91 21,999.62 -208.71 -0.9%
S&P 500 2,249.92 2,056.50 193.42 9.4%
         
USA        
Birks Group $1.09 $0.44 $0.65 147.4%
Blue Nile $40.64 $37.04 $3.60 9.7%
Charles & Colvard $1.06 $1.12 -$0.06 -5.4%
JCPenney $8.47 $6.91 $1.56 22.6%
Kohl's $49.81 $47.24 $2.57 5.4%
Macy's $36.28 $35.50 $0.78 2.2%
Movado Group $28.70 $26.47 $2.23 8.4%
Nordstrom $48.41 $50.35 -$1.94 -3.9%
Signet $93.70 $120.89 -$27.19 -22.5%
Sotheby's $40.30 $25.95 $14.35 55.3%
Tiffany $77.38 $76.60 $0.78 1.0%
Walmart $69.31 $60.75 $8.56 14.1%
         
Far East        
Chow Sang Sang (HKD) 14.46 12.70 1.76 13.9%
Chow Tai Fook (HKD) 5.90 5.01 0.89 17.8%
Luk Fook (HKD) 19.92 16.10 3.82 23.7%
Sarine (SGD) 1.73 1.50 0.24 15.7%
ValueMax Group 0.24 0.28 -0.04 -14.3%
         
Europe        
Damiani €0.97 €1.19 -€0.22 -18.7%
LVMH €180.20 €146.60 €33.60 22.9%
Kering €213.80 €158.55 €55.25 34.8%
Richemont CHF 67.65 CHF 72.35 -CHF 4.70 -6.5%
Swatch Group CHF 316.30 CHF 345.80 -CHF 29.50 -8.5%
         
INDIA (rupee)        
C.Mahendra 1.79 1.26 0.53 42.1%
Gitanjali Gems 55.35 41.45 13.90 33.5%
Goenka Diamond 0.80 1.75 -0.95 -54.3%
Goldiam Intl. 63.25 52.10 11.15 21.4%
Lypsa Gems 54.10 128.00 -73.90 -57.7%
Rajesh Exports 457.45 677.20 -219.75 -32.4%
Ren. Jewellery 125.05 133.30 -8.25 -6.2%
Titan 321.15 350.95 -29.80 -8.5%
Vaibhav 277.00 507.50 -230.50 -45.4%




Mining Stocks        
ALROSA RUB 96.21 RUB 54.76 RUB 41.45 75.7%
Dominion Diamond CAD 12.77 CAD 14.03 -CAD 1.26 -9.0%
Kennady Diamonds CAD 3.90 CAD 3.00 CAD 0.90 30.0%
Lucara Diamond CAD 3.01 CAD 2.27 CAD 0.74 32.6%
Mountain Province CAD 6.68 CAD 4.03 CAD 2.65 65.8%
Peregrine Diamonds CAD 0.20 CAD 0.15 CAD 0.05 34.5%
Rockwell Diamonds CAD 0.06 CAD 0.14 -CAD 0.08 -55.6%
Shore Gold CAD 0.17 CAD 0.18 -CAD 0.01 -5.6%
Stornoway Diamond CAD 0.97 CAD 0.73 CAD 0.24 32.9%
UK (pence)        
Anglo American 1,165.00 306.55 858.5 280.0%
Firestone Diamonds 51.00 18.25 32.8 179.5%
Gem Diamonds 111.50 117.16 -5.7 -4.8%
Gemfields 52.00 40.79 11.2 27.5%
Petra Diamonds 158.00 88.00 70.0 79.5%
Rio Tinto plc 3,162.00 1,974.00 1,188.0 60.2%

Image: Sam Valadi
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Tags: Alrosa, and Firestone Diamonds, Anglo American, birks group, Blue Nile, Chow Sang Sang, Chow Tai Fook, damiani, De Beers, Donald Trump, Financial markets, Hong Kong, India, J.C. Penney, jewelers, Jewelry, Joshua Freedman, kering, lucara, Lucara Diamond Corp., Luk Fook, LVMH, LVMH Moët Hennessy Louis Vuitton, mining, mountain province, retail, Richemont, Rio Tinto, Signet Jewelers, Sotheby’s, stocks, swatch group, u.s.
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