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Rapaport Weekly Market Comment

Jun 20, 2019 10:58 AM   By Rapaport News
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Sentiment weak as polished prices continue to soften. Hong Kong fair opens with hope for better trading than Las Vegas shows. Outlook for Chinese local demand improves as luxury consumers shift to domestic spending, since weak yuan and trade war have reduced tourist shopping. Jewelers avoiding inventory buildup. Rough market cautious despite reported 4% to 8% price cut on small rough during low-value De Beers sight. Manufacturers reducing operations due to sluggish demand and tight profit margins. Christie’s Maharajas & Mughal Magnificence sale nets $109M (93% by lot) with Cartier diamond brooch selling for $10.6M. French billionaire Patrick Drahi acquires Sotheby’s for $3.7B.

Fancies: Fancy shapes soft, reflecting slowdown in high-end 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 the strongest prices, as are buyers with specific requests. Ovals for fashion jewelry moving well, especially VS2-SI2. Demand for Radiants and Emeralds down. 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: Slow trading ahead of July break. Retail performing better than last year, but dealer market weak. Jewelers limiting purchases and taking more goods on memo. Stable demand for 1 to 1.25 ct., G-J, VS-SI diamonds. Bridal steady during summer wedding season, but there is concern that average spend on engagement rings is declining.

Belgium: Sluggish rough and polished trading. Dealers who shunned Las Vegas are traveling to Hong Kong Jewellery & Gem Fair (June 20 to 23), where they see greater buyer potential. Top-make SIs doing well, but suppliers stuck with a lot of lower-quality goods. Large stones slow. Rough market soft during De Beers sight.

Israel: Cautious mood in the bourse. Several dealers attending Hong Kong show after Las Vegas failed to boost trading activity. Small goods below 0.60 ct. weak. Steady demand for SI-I1 diamonds. Large-stone market subdued in both rough and polished.

India: Polished trading relatively quiet for this time of the year. Some companies reducing prices to boost activity and liquidity. Manufacturers cutting their rough intake, as they’re maintaining low factory production levels. Few overseas buyers in Mumbai as focus shifts to Hong Kong for the show. Locals looking for 1 ct. and larger stones, as small sizes remain weak.

Hong Kong: Dealers concentrating on this week’s show. There is concern some buyers have canceled due to ongoing protests in the city, which have also affected sentiment in the luxury sector. Major retailers are reducing inventory and have avoided large purchases in recent months. Steady demand for 0.30 to 0.50 ct. and 1 ct., F-I, VS-SI, RapSpec A3+ goods. Colored-diamond dealers more optimistic than others.
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