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Rapaport Weekly Market Comment

Mar 29, 2018 11:00 AM   By Rapaport News
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Market slowing ahead of Passover and Easter. Recovery in watch industry lifts mood at Basel show, but event fails to raise diamond-dealer sentiment due to low attendance. Indian fraud cases increase concerns about credit. High rough prices reducing manufacturing profit, with polished factories working below full capacity. Asian demand up, with Chow Sang Sang 2017 sales +3% to $2.1B, profit +18% to $112M. New Alrosa guidelines urge rough clients to publicize stones’ Russian provenance. There will be no new Rapaport Price List on April 6 due to the Jewish holiday of Passover.

Fancies: Fancy shapes mixed, with curves better than squares. Ovals hot, Marquises strong, followed by Pears and Cushions. Emeralds and Radiants fair, Princesses still weak. Oversizes selling well. Steady demand for fine-quality 6 to 10 ct. Ovals, Pears and Emeralds, with limited supply. US supporting market for commercial-quality, medium-priced fancies under 1 ct. Far East demand improving as consumers seek fancy shapes at better prices. Off-make, poorly cut fancies illiquid and hard to sell, even at very deep discounts.

United States: Wholesale trading slow, with dealers finding it expensive to replace goods. Demand centering on 1 to 2 ct., F-K, SI stones. US March consumer confidence down from February’s 18-year high as stock-market volatility raises concerns. Jewelers note weak retail market, though higher-end stores successfully selling nice 1 to 3 ct. diamonds in higher color and clarity.

Belgium:
Trade improving, with solid interest in 0.30 to 0.40 ct., D-M, VVS-SI, and for 1 ct., D-F. Dossiers moving well. Mixed demand for larger goods, with 2 to 3 ct. stronger than 1.5 ct. and 4 to 5 ct. Hike in India import tax raises concerns for Belgian traders. Smaller Basel show fails to boost dealer sentiment.

Israel: Market slowing ahead of seven-day Passover holiday (March 31 to April 6). Sentiment weak after disappointing Basel show. 3 ct. and larger in short supply, with buyers reluctant to meet dealers’ high asking prices. Shortages of nice Emeralds, Pears and Ovals. Hot demand for round, 0.23 to 0.27 ct. stones due to specific orders from retailers. Fancy shape, F-I, VS2-SI2 and select I1 diamonds popular.

India: Market uncertain following Nirav Modi-Gitanjali fraud claims, with traders fearing impact on bank credit. Companies delaying purchases until after financial year’s end (March 31). Buyers seeking nicely cut goods with low color and clarity. Strong interest in 1 to 3 ct., I1-I2 goods, and for diamonds under 1 ct., VS1-VS2, no black center. Fair demand for stars and melee in G-I, VS-I1. Polished manufacturing at 70% to 80% capacity as firms limit rough buying due to high prices.

Hong Kong: Positive mood as retailers anticipate good year ahead. Strengthening yuan currency has lifted Chinese spending power, resulting in better consumer sentiment and increased tourism to Hong Kong. High end strong, with steady demand for nicer-quality 1 to 2 ct., IF-VVS stones. Growing interest in 2 ct., J-M. Fancy colors gaining popularity. Hearts selling well, and orders of half-moon cuts rising.
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