The Big Diamonds Still Sell

Posted on | October 16, 2008 | No Comments

Check out what happened yesterday at Christie’s New York…

NEW YORK (AFP) — Two giant diamonds sold for more than six million dollars at auction Wednesday to a Middle Eastern buyer, bucking a wave of gloom that has taken the shine off luxury sales.

The Ponahalo diamonds, mined in South Africa and named after a tribal word meaning “vision,” sold at Christie’s in New York at the end of an auction overshadowed by massive losses on world stock markets.

The Ponahalo weighed 316 carats when discovered in its rough form in 2005. Two separate diamonds were cut, weighing 70.87 and 102.11 carats, about the size and shape of chocolates.

The first sold for 2.15 million dollars, including commission, and the second for a total of 4.11 million dollars after a bidding war that within seconds jacked up the cost by a million dollars.

Although the winning bid came in anonymously to a telephone operator in the packed auction room, the buyer was apparently so proud that he wanted to be revealed.

“The buyer of the diamond was Mr Amer Radwan of Dubai and he has asked us to relate to you that he purchased this diamond,” auctioneer Rahul Kadakia announced, prompting surprised laughter and a few gasps.

“Dubai, of course Dubai,” a tall, tanned and expensively dressed woman muttered knowingly.

The dramatic sale of the two stones came on a day of price collapses on world stock markets and growing fears of recession in the United States.

On Wall Street, a short bus ride from Christie’s in Manhattan, the Dow Jones Industrial Average slid 733.08 points, or 7.87 percent to 8,577.91.

This was the worst one-day point loss since last month’s record 777-point decline and the steepest percentage drop since 1987.

The diamond industry now fears a painful end to the year, typically the season when dealers and sellers earn most of their money through Christmas and other holiday spending.

“The now inevitable economic slowdown will impact the entire diamond pipeline,” the industry website idexonline.com said Wednesday.

One dealer attending the Christie’s auction said the market is “dead.”

“There’s no two ways about it. It’s totally different to three months ago,” he said, speaking on condition of anonymity.

The auction, which covered everything from Tiffany bracelets to gem-encrusted Montblanc fountain pens, grossed about 29.7 million dollars, Christie’s said.

This was short of the expected 35 million dollar haul.

A higher proportion than usual of items under the hammer failed to sell and several of the most glamorous pieces — such as a piece the catalogue described as a “sensational diamond necklace” — were withdrawn altogether.

But auctioneer Francois Curiel looked on the bright side.

“It’s huge if you think that in a few hours today nearly 30 million dollars worth of diamonds sold in what are hardly great market conditions,” he told AFP.

The Ponahalos, he said, might be a girl’s best friend — or an investor’s.

Gisele Bundchen’s jewels also did fairly well. Her yellow diamond ring which had a high estimate of $20,000 went for $30,000.

“Given the volatility of the markets lots of people are looking for portable assets. You can have a house, pictures, stocks, bonds, but with these you have six and a half million dollars you can just put in your pocket.”