will the Indian art market mirror the Indian stock market this week?

Over fifty billion dollars of wealth has been eroded in a matter of days. Imagine Bill Gates and Warren Buffett just went broke!

The Indian financial markets have continued to nosedive much to the dismay of millions of investors. There is a visible panic as the injured run for cover but the lord of the bourses is showing no mercy. So what does this mean to the infallible Indian art market? What impact will it have on the upcoming auctions? That is the big question of the day.

My own view is that its business as usual especially in the short run and here are three reasons why;

1. Majority of the buying - especially at these price levels is happening from outside the country by the wealthy of Indian origin who are least impacted by the turbulence in Dalal street
2. A large proportion of the buying that happens at auctions is still by the ‘trade’ and local art dealers and gallerists are hardly fazed by much these days. Even the few resident Indians brave enough to make a winning bid are not exactly dipping into their primary investments to get their high at the auctions
3. There is a theory of negative correlation between art and other asset classes such as equities suggesting a mildly inverse relationship between price of equities on the price of art. Although that is yet to be proven out completely, I am going to go with the gurus on this one for now

Considering the above, both the sales should do exceedingly well and I wish the team at Sotheby’s in London and Christies in Dubai the very best!