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NEW YORK (Reuters) - A lackluster Sotheby's auction that failed to sell a Vincent van Gogh landscape saw shares in the company plunge on Thursday, but some experts said inflated estimates were more to blame than worries about the economy.
The Sotheby's Impressionist and modern art auction took in just under $270 million on Wednesday night -- falling short of a pre-sale estimate of $355 million -- and was unable to move a quarter of the paintings, including van Gogh's "Wheat Fields."
Sotheby's share price was down about 37 percent in afternoon trade on Thursday.
Contrary to fears that collectors would pull back until financial and mortgage markets stabilize, Elizabeth von Habsburg, president of independent appraisal and art consulting firm Gurr Johns Masterson, said demand for art has not moved in line with wild swings in the world stock markets.
"Estimates were too high on items that had been circulating on the market," she said, referring to van Gogh's piece. "The art market is very deep."
A Christie's auction on Tuesday achieved the second-largest result ever for Impressionist and modern art, with new records for Matisse, Pissarro and Signac all factoring in the sale's $395 million total.
Von Habsburg said smaller Wall Street bonuses and anticipated job losses due to the turmoil in housing and credit markets were not expected to dampen demand for art -- and she is hardly alone in her view.
"The high-end art market is not driven by Wall Street bonuses," said Jeffrey Gundlach, an art collector and chief investment officer of TCW Group in Los Angeles, which manages assets worth $160 billion.
"When Mark Rothko's 'White Center' sells for $74 million, when Andy Warhol's 'Green Car Crash' sells for $71 million, when Picasso's 'Garcon a la Pipe' sold for $104 million a few years ago, that is not some guy on Wall Street that happened to get a good bonus," he said.
An informal study by Sotheby's of its top 500 buyers over the past five years found that less than 10 percent were collectors with financial-services wealth.
Stephen Pastore, owner of more than 300 original paintings including Picasso, Monet and Rene Magritte, and a bidder at this week's sales, said: "Art collecting is a visceral occupation and if I were to worry about what my house is worth every time I purchased a painting, I'd think myself an idiot."
"Anyone concerned with the fluctuating value of their house shouldn't be buying art -- they should be investing in Prozac stocks," he said.
Helping ensure strong demand are foreign buyers, whose increasing presence in the U.S. art market is because of their stronger currencies against the weakening U.S. dollar.
On average, the dollar has fallen about 10 percent against the major world currencies over the last year. The euro has been hitting a series of records versus the dollar and even Canadians are showing up at auctions, as the dollar has plunged more than 18 percent against the Canadian currency this year.
Von Habsburg said that while the failure of "Wheat Fields" to sell was not a surprise to her, neither was the demand for "The Four Seasons," an 1872-73 suite of four paintings by Pissarro that sold for $14.6 million at Christie's on Tuesday -- a record price at auction for the artist.
"You really can't come to a broad conclusion because "Wheat Fields" didn't sell," she said.
Editing by Michelle Nichols and John O'Callaghan