"Suprematist Composition" by Kazimir Malevich

Sotheby's failed to sell a third of the lots at its Impressionist and modern art auction last night in New York, the latest sign that worldwide financial distress is undermining demand for trophy paintings and sculpture.

Just 64 percent of the 70 lots found buyers, the lowest rate for an Impressionist evening sale at Sotheby's since May 2001. The $223.8 million tally was a third below the $338 million low estimate. Christie's International holds its Impressionist and modern art sales tomorrow and Thursday nights.

``The market just corrected,'' said John Good, a director at Gagosian Gallery, as he and about 800 others departed Sotheby's cavernous white-walled salesroom.

Among the bright spots, Kazimir Malevich's geometric 1916 ``Suprematist Composition'' sold for a record $60 million to a lone bidder. Henry Kravis's elegant Edgar Degas ballerina pastel made $37 million, also an auction record for the artist.

In a press conference following the sale, auctioneer Tobias Meyer cited a ``changed financial environment'' for what he referred to as a ``new market'' for art.

``You just need to look outside the window to see we're in a new world,'' Meyer told reporters. ``But this new world still needs art.''

Following a year in which credit markets froze and stocks plunged worldwide, the mood was tense and somber as dealers chomped chewing gum, nibbled nail beds and punched keys on Blackberry devices.

``It wasn't terrible,'' dealer Asher Edelman said. ``But it was not a good sale.''

No Bidders

Sotheby's shares fell 36 cents to $9.25 in New York Stock Exchange composite trading as of 4:05 p.m. They're off 82 percent in 12 months.

While the rarest works commanded hefty prices last night, run-of-the-mill offerings by Pissarro, Giacometti, Cezanne, Chagall and Kandinsky didn't sell. Sotheby's had given guarantees to sellers for several works that went unsold. Chief Executive William Ruprecht said the company sold the majority of guaranteed works but declined to comment on how the house fared financially.

The casualties were large and small. Amedeo Modigliani's jowly mustached ``Homme Assis,'' estimated at over $18 million, didn't elicit a bid; nor did Impressionist Claude Monet's lavender-flecked 1893 canvas of a fog-enveloped Rouen cathedral, projected to fetch more than $16 million. The painting had sold for $1.2 million in 1986 at Sotheby's in London.

Van Gogh Flops

Other flops included an atypical Van Gogh painting of a statue, estimated to sell for up to $10 million, and still-lifes by Picasso and Matisse.

Sotheby's began assembling its sale in the summer, before the recent market rout, signing up artworks at predicted prices pegged to the strong spring season. In recent weeks, auction- house executives have tried to persuade sellers to adjust expectations, lowering ``reserves,'' the secret minimum bid below which a work won't sell.

Rival Christie's International holds its evening sales tomorrow and Thursday, with a break for election night. That gives specialists more time to haggle with sellers about reserves. Christie's two-night sale may tally up to $560.8 million.

Next week's evening auctions feature contemporary art, with two-week totals for the two major houses projected at as high as $1.9 billion, a figure that tonight's sale might put in jeopardy. Recent sales in London and Hong Kong also were disappointing.

Iconic Malevich

Last night's top lot, the Malevich, showed that iconic works still command high prices. ``Suprematist Composition'' features floating black, yellow, orange and green rectangles painted against a crisp-white background. The Russian avant-garde artist rejected representational art, arguing that ``color and texture in painting are ends in themselves.''

The work had been estimated to sell for about $60 million, and just one phone bidder vied for it. The sellers were the artist's heirs, who gained ownership of the painting and four others after a court battle with the city of Amsterdam. The canvas had been part of the Stedelijk Museum collection since 1958 and was returned earlier this year.

Vampire Kiss

The second-priciest lot, one of the few works with a handful of aggressive bidders, was Edvard Munch's 1894 dramatic ``Vampire,'' with a flame-haired maiden either kissing or biting the neck of her man. The buyer, who bid by phone, was a U.S. collector, according to Sotheby's.

The painting had previously been on loan to New York's Metropolitan Museum of Art and Washington's National Gallery of Art. The Norwegian painter, famous for ``The Scream,'' has been a recent force at the auctions. In May, Sotheby's sold Munch's brightly colored 1902 ``Girls on the Bridge'' for a record $30.8 million. ``Vampire'' fetched $38.2 million from an anonymous phone bidder, exceeding the $30 million estimate and becoming one of the evening's few jolts of bidding action.

Edgar Degas's 1879 ``Danseuse au repos,'' portraying a seated ballerina, sold for a record $37 million to Yasuaki Ishizaka, head of Sotheby's Tokyo office, on behalf of a telephone bidder. Kravis had purchased the drawing at Sotheby's in 1999 for $28 million, a record at the time. Sotheby's said the seller's tastes had shifted toward modern art. Kravis' wife, Marie-Josee Kravis, is president of the board of trustees at New York's Museum of Modern Art.

Prices include a buyer's premium, or commission, of 25 percent of the hammer price up to $50,000, 20 percent of the price from $50,000 to $1 million and 12 percent above $1 million. Estimates do not include commissions.