Rapaport Weekly Market Comment

Sentiment weak, with Indian cutters lacking liquidity.
Steady demand for 1 ct. diamonds supporting the market. Low manufacturing
profits placing pressure on under-0.50 ct. sector. Rough prices stable at De
Beers sight, with April sales +10% to $575M. Trade expecting shortages, as De
Beers plans to reduce supply to sightholders in new sales period. Alrosa March
sales -33% to $377M. Graff unveils world’s largest square emerald diamond: A
302.37 ct., D stone cut from 1,109 ct. Lesedi La Rona. LVMH upbeat on luxury market,
with 1Q jewelry and watch sales +9% to $1.2B. Far East retail outlook uncertain.
Responsible Jewellery Council names Iris Van der Veken executive director.

Fancies: Fancy shapes stable, driven by US
and European demand. Ovals for fashion jewelry moving well. Supply shortage
supporting prices for Pears, with 1.50 ct. the strongest category. Radiants
improving. Marquises and Princesses weak, despite reduced manufacturing.
Excellent-cut Ovals, Cushions, Pears and Emeralds doing nicely, with steady
orders for fine-quality goods in 6 to 10 ct. Chinese consumers seeking fancy
shapes at better prices. US sustaining market for commercial-quality,
medium-priced fancies under 1 ct. Off-make, poorly cut fancies illiquid and
hard to sell, even at very deep discounts.

United States: Trading slow, with weak interest in
higher colors and clarities. Suppliers shifting to 1 to 3 ct. G-J, VS-SI
diamonds, which have good consumer demand. Retailers not buying for stock, and are
willing to pay more for memo to avoid holding goods in inventory.

Belgium: Sentiment low, but market stabilizing.
Steady demand for 0.50 ct., SI-I1, G-J diamonds. Fluorescents attracting very deep
discounts, especially in 3 ct. and larger. Dealers anticipate shortages as De
Beers reduces rough supply.

Israel: Steady movement in 1 to 2 ct. diamonds.
Overall bourse activity low, as Tuesday was public holiday due to national
elections. Trade slowing ahead of Passover, with exchange partially closing
from April 19 to 27.

India: Polished demand sluggish due to tight
liquidity. Few overseas buyers in the market. Melee under pressure, especially for
VVS qualities, with SI-I1 moving better. Dealers avoiding inventory purchases, instead
showing specific demand for select categories. Limited availability of SI
clarities as manufacturers decrease production. Jewelry sector subdued.

Hong Kong: Market seasonally quiet. Orders shifting
to lower colors. VS the most popular clarity, with buyers considering VVS if
the price is right. Shortages of 1 ct., G-J, SI diamonds with triple-Ex cut and
no black inclusions, since manufacturers are increasingly shipping polished
directly to mainland China rather than sending to Hong Kong. Sentiment down, as
trade war with US remains unresolved. Large Hong Kong retailers reducing
inventory amid low expectations for coming year.