Market Trend

Between March 8^th and March 22nd, MCI index surged 307.5 points to 7480.6 points. The reasons for the increase in MCI are highlighted as follows: First, amid market consensus of a looming panel oversupply in the second quarter, an earthquake that measures 6.4 on the Richter scale rattled through Jiansian Township, Kaohsiung County, Taiwan, on March 4th. The incident is expected to impact market supply of panels, and stimulate an increase in panel prices, boosting confidence among panel makers. Second, on March 15^th, Taiwan government officially approved AUO’s application to build a 7.5-generation panel plant in Kunshan, Jiangsu Province, China. This move will promote the future development of Taiwan's flat panel makers. Third, on March 18^th, the merger of Innolux and Chi Mei officially took effect, making Chimei Innolux Corporation the kingpin of Taiwan’s panel industry. As the overall supply chain becomes more fully-integrated, it will further enhance the competitiveness of Taiwan’s panel industry. All three favorable factors spurred the surge in MCI. However, amid high inventory build-up among brand vendors, a decrease in panel demand seems inevitable, leading to high levels of market uncertainty in April.