Concerns about Hong Kong show remain as protests
continue despite withdrawal of extradition bill that sparked them. Luxury
jewelers developing China strategy to focus on high-end consumers, who are spending
more at home. Weak Chinese wholesale demand weighing on diamond market, with 1
ct. RAPI -0.4% in August. US jewelers considering buying opportunities but
delaying holiday stock orders. Signet Jewelers 2Q sales -4% to $1.4B, net loss
of $44M vs. $31M loss last year. Polished inventory levels reduced, but still
higher than previous years. Manufacturing profit margins tight despite limited rough
supply. Rough prices must come down to enable better 2020.
Fancies: Fancy shapes soft, reflecting slowdown in overall demand. 3
to 8 ct., I-K, VS-SI1 moving better than rounds as dealers and consumers shift
to lower price points. Well-known brands are paying highest prices, as are
buyers with specific requests. Ovals for fashion jewelry moving well,
especially 1.50 and 2 ct., G-H, VS and H-K, SI2. Marquises and Princesses weak
despite reduced manufacturing. US sustaining market for commercial-quality,
medium-priced fancies under 1 ct. Chinese consumers seeking fancy shapes at
better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at
very deep discounts.
United States: Market quiet during shorter week that
began with Labor Day. Dealers hoping for better September ahead of holiday
season. Buyers cautious and struggling to profit as prices continue to soften.
Jewelers prefer taking memo. Steady demand for 1 to 1.50 ct., G-J, VS-SI
engagement-ring goods, with rising interest in ovals.
Belgium: Sentiment weak amid soft trading
following summer break. Calls to fill specific orders, but very few buying for
stock. Large stones above 3 carats, G-I, VS-SI holding steady. Rough activity
slow, with limited supply and low profit margins. Dealers hoping for price
reduction at September sales.
Israel: Some improvement after vacation period,
but trading still cautious. Uncertainty surrounding the Hong Kong show,
although some foresee buying opportunity in weak market. Far East quiet. US
stable, but more calls for memo than full orders. Shortage of nice SIs, which
are in demand.
India: Slow trading over Jain Paryushan
festival and Hindu Ganesh Chaturthi holiday. High gold price and declining
currency (INR 72/$1) impacting domestic jewelry demand. Jewelry manufacturers
compensating by reducing diamond content. Cutters maintaining low production
until October 27 Diwali break, with some smaller units already closing.
Polished inventory levels went down in last month, but still higher than
previous years.
Hong Kong: Business sluggish as city enters third month of pro-democracy
demonstrations. Exhibitors struggling to confirm appointments ahead of
September 16 show. Local wholesalers expecting some dealer activity at the
fair, but low Chinese buyer attendance. Stable demand for 1 ct., D-G, SI goods.
Luxury jewelers focusing on mainland China to capitalize on a shift toward
local purchasing among the country’s consumers.
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