London art auctions show market in a correction

Lucien Freud's ‘Pregnant Girl,’ left, and Adrian Ghenie's ‘Sunflowers’ were sold at the Contemporary Art Evening Sale at Sotheby's on Feb. 10, 2016, in LondonPHOTO:TRISTAN FEWINGS/GETTY IMAGES

(THE NEW YORK TIMES) The second week of the big art auctions here got off to an ominous start at Phillips on Tuesday, when a seller withdrew a Damien Hirst medicine cabinet with a title that seemed to match collectors’ moods: “In Search of Reality.”

That theme summed up the evening sales at Christie’s,Sotheby’s,and Phillips, as theart market coolsafter the frenzied highs of the past few years. Collectors have become pickier, bypassing less-spectacular pieces in favor of colorful, decorative scenes or iconic works regarded as safe bets.

Together, Sotheby’s and Christie’s sold $184.7 million during a pair of contemporary evening auctions, far shy of last year’s $364 million for similar sales. The 2015 figure was driven by $188 million at Sotheby’s, which set a record at the time for a contemporary art sale by the auction house in London.

On Thursday, rival Christie’s sold 89% of 61 lots, for a total of $84.3 million, above their presale low estimate of $72.7 million. The day before, Sotheby’s sold 78% of the 55 lots in its contemporary art evening sale, for a total of $100.4 million. (That is within the house’s presale estimate of $87.1 million to $124.5 million)

“It’s a correction we’ve all been waiting for,” says Nazy Vassegh, chief executive of the London-based international art fair Masterpiece. “There’s been no frenzied bidding in the sales room. The market seems to be highly price sensitive and really selective.”

The shakiness comes amidtumult in stock marketsaround the world. Sagging oil prices, weakness in global banking sectors, and slowing economies in China and emerging markets all contributed to the markets’ volatile start to 2016. Year-to-date, the Dow Jones Industrial Average and the S&P 500 are both down more than 10%. On Thursday, Sotheby’s shares fell $4.06, or 17.5%, to $19.13 on the New York Stock Exchange.

OFF THE BLOCK: Gerhard Richter’s ‘Abstract Painting’ was

withdrawn.PHOTO:SOTHEBY

After Sotheby’s contemporary sale, Stifel analystDavid Schickdowngraded the house’s stock from “buy” to “hold.” Even if financial markets bounce back, Mr. Schick said, he worries that auction houses will keep winnowing theirfees to attract coveted consignments—a move that could erode profits.

For the Wednesday evening sale, Sotheby’s gamely set a lively tone by serving drinks and outfitting its Bond Street sale room with nightclub-worthy blue lights and pulsing music. It also sold the week’s most expensive work: Lucian Freud’s large portrait of his sleeping lover Bernardine Coverley, pregnant with their childBella Freud(now a fashion designer in London). Six bidders on the 1960-61 oil painting, which had been in a private collection since 1983, drove its price up to $23.2 million, above the $14.5 million high estimate.

Other works fell short of expectations. Tauba Auerbach’s pastel-colored “Untitled (Fold)” painting had a low estimate of $1.4 million, but stalled at $1.08 million and went unsold. And only one bidder sought out an expected star of the sale, Alberto Burri’s burlap-covered “Sack and Red.” The 1959 piece of Arte Povera sold to that one-bid winner for $13.2 million with the house’s fees, just over the $13 million low estimate.

“The buyers are just more selective,” said art adviser Patrick Legant.

Some heavily promoted works never even got a chance to perform. Sotheby’s auctioneer Oliver Barker drew audible chatter from the crowd when he announced the withdrawal of Gerhard Richter’s “Abstract Painting,” which carried a low estimate of $21.1 million. London collector Fatima Maleki didn’t return calls after the sale asking why she had withdrawn the work at the last minute.

Art adviser Thea Westreich says Ms. Maleki’s move is likely a wise one because withdrawing a work doesn’t traditionally hurt its chances of resale—unlike pieces that don’t sell at auction, which often must be offered later at steep discounts.

Lucian Freud’s ‘Pregnant Girl’PHOTO:SOTHEBY'S

Christie’s, which historically shines in contemporary sales, once again managed to pull off a brisk auction dominated by pieces in the $500,000 to $5 million range—a middle-market price point that feels solid to wary bidders. The major soft spot was its supposed masterwork, an Yves Klein painting that stalled at $10.9 million and went unsold.

Christie’s contemporary specialist Francis Outred said the house prepared “with a cautious frame of mind” by focusing on realistic estimates and walking away from a few top lots.

The atmosphere last February was “much better,” Mr. Legant, the art adviser, said. “There were so many people interested in buying art.”

At Phillips, which sold $35.1 million (79% of its 43 lots) at its 20th century and contemporary sale Tuesday night, auctioneer Hugues Joffre said he was “disappointed” with the results for a brushwork-heavy painting by Pierre Soulages. Bidding stalled around $3.45 million, a bid shy of the work’s $3.6 million low estimate, and it went unsold—a sign the seller was unwilling to lower the work’s reserve, or secret minimum price.

Yves Klein’s ‘Untitled Anthropometry, (ANT 118)’ drew a $10.9 million bid at Christie’s on Thursday but failed to sell.PHOTO:CHRISTIES IMAGES LTD.

Auction houses did manage to find collectors willing to splurge on standout works. At Sotheby’s, dueling phone bids drove the price of a nude bronze by Auguste Rodin to $16.7 million, far above its high estimate of $11.5 million.

Less-flashy works, even by blue-chip artists, failed to attract buyers. Though Freud’s “Pregnant Girl” sold within its presale estimate, collectors passed on a tiny oil, “Annabel,” by the artist at the same sale at Sotheby’s. The house was hoping for at least $723,050 for the work.

London collector Tiqui Atencio, typically a fixture of these sales, decided to skip them altogether this year because “the quality wasn’t in the catalogs this time,” she said.

“Everyone is jittery about oil prices, ISIS and China,” she added. “Collectors still have money, but they’re sitting on the sidelines, not consigning good things and waiting to see what happens.”

Corrections & Amplifications

A $188 million auction at Sotheby’s last year set a record at the time for a contemporary art sale by the auction house in London. An earlier version of this article incorrectly called it a record for the industry. The overall record for a contemporary art sale in London was set by Christie’s with a $207.3 million sale in 2012.