Industry News by Nemesis

Rapaport Weekly Market Comment

November 10, 2016

Great changes in America as Trump victory to have major impact on political, social and economic conditions. Diamond and jewelry sector will benefit as new policies create a more prosperous middle class and greater numbers of wealthy consumers. Indian government cracks down drastically on cash by eliminating 500 and 1,000 rupee notes. Jewelry and gold sales surge as consumers dump currency. Titan Company 2Q sales +2% to $824M, profit +24% to $27M. Blue Nile to be sold for $500M to Bain Capital and Bow Street as 3Q sales -4% to $105M, profit -35% to $1.3M. U.S. Sep. polished imports +33% to $2.2B. Sarine to introduce automated color and clarity grading next year.

Fancies: Fancy-shape market stable. Curved fancy shapes improving. Princess, 0.50 to 1 ct. waking up for U.S. holiday season. Large sizes getting some interest, but buyers are extremely picky. Fancy shape prices relatively soft in a buyer’s market. U.S. demand supporting market for small-to-medium size, commercial-quality fancies. (H-J- SI2-I2). Far East fancy demand weak. Significant price differentials between excellent- and average-cut fancies. Off-make, poorly-cut fancies illiquid and very hard to sell, even at very deep discounts.

United States: Polished trading soft but prices firm for 0.70 to 1.25 ct., H-J, SI, RapSpec A2+ qualities. Memo suppliers demanding quick returns before Thanksgiving. Some trading activity in New York but focus shifting to Christmas retail promotions. Jewelry market sentiment mixed after Trump election victory. 

Belgium: Positive mood with steady demand for 0.30 to 0.90 ct., H-J, SI diamonds. 1 ct., H+, VVS+ softer. Fancy shapes stable with improving demand for 1 ct. and larger Emeralds, Pears and Cushions. Rising demand for high-end, investment-quality diamonds. Manufacturing profit margins tight with steady rough demand during De Beers sight week. 

Israel: Markets stable. Manufacturers challenged by low profits with high rough prices and scarce supply. Dealer prices firm with steady U.S. demand ahead of Thanksgiving. Good Far East demand for 0.30 to 0.50 ct., G-J, VVS-SI, RapSpec2 diamonds as jewelers prepare for Chinese New Year. 

India: Market shocked by new currency regulations as government cracks down on black markets. Consumer rush to buy gold and jewelry after government cancels 500 and 1,000 rupee notes. Currency may be deposited in banks until Dec. 31. Trading quiet as businesses slowly return from Diwali break. Factories still closed with workers expected to return Nov. 21. 

Hong Kong: Trading relatively quiet. Dealers filling specific orders with little buying for inventory. Retailers preparing for Chinese New Year with trading slower than previous years. Steady demand for 0.30 to 0.50 ct., G-H, VS-SI diamonds.Hong Kong retail sales weak with Sep. jewelry, watch and luxury gift sales -12%. China jewelry market stable with strong online sales expected on Singles Day (11/11). 

 

Source: Rapaport

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