Three Recurring Themes

Three developments stood out in this week’s news.

The first was the continued strength of jewelry in the luxury market. Kering’s third-quarter update showed sales at its jewelry brands, including Boucheron, Pomellato, DoDo and Qeelin, rising 12%. Fashion and leather goods declined 1%, eyewear grew 6% and other segments fell 5%. That mirrors the trend at LVMH, where Watches & Jewelry was the group’s strongest performing category. It also supports the renewed focus on the high end among more mainstream chains, including Signet’s repositioning of Blue Nile, and the introduction of high-jewelry collections by David Yurman, Brilliant Earth and others.

The second was continued growth among Hong Kong-based jewelers in the third quarter, though the pace was uneven. Chow Tai Fook’s same-store sales rose, although revenue at self-operated stores edged down 0.5%. Luk Fook reported 12% growth, and Chow Sang Sang’s sales increased 3%. I expect the pace of recovery to slow further, and potentially reverse in the coming quarters, as results face tougher comparisons with last year, when a buoyant gold market fueled demand. For more on the recovery, see my earlier video analysis published after the second quarter: Can China’s Jewelry Recovery Lift Diamond Demand?

The third was the formation of the Diamond Producers Council (DPC), a major move by the lab-grown sector. After years of oversupply and falling prices, producers are beginning to organize around a shared agenda. The council’s significance may extend beyond the debate over how lab-grown diamonds should be described and the advocacy work it highlights. I explore that in my latest column: A Pivotal Move for the Lab-Grown Diamond Industry.

Read the full October 26 edition of the Pressing Matters Executive Memo here.

Pic of the Week

Rare Pink Resurfaces: The Grand Condé pink diamond is going on display at the Château de Chantilly in France for the first time since it was stolen nearly 100 years ago, almost to the day. Weighing more than 9 carats, the historic stone was taken in 1926 and later found hidden inside an apple. Le Diamant Rose exhibit runs from October 17 to January 3. (L'Ecole des Arts Joailliers, Benjamin Chelly)