Market Trend

According to the latest survey by WitsView, a research division of TrendForce, the MCI index fell by 90.5 points to 5700.5 between April 06, 2011 to April 18, 2011. Beginning from mid-Apr11, the major panel makers are respectively scheduled to release their 1Q11 quarterly earnings report. LGD was the first to report its quarterly performance on April 18. Although LGD narrowed its quarterly sales drop to a mere 4%, it was still unable to swing to a profit in 1Q11. This evidently illustrates the difficult market conditions that panel makers are currently facing. Thus, even as panel makers attempt to increase the panel price quotes in 2Q11 in hoping to improve their financial performance, given the fact that the end market demand remains sluggish, they may continue to book a net quarterly loss in 2Q11.

Separately, the persisting unstable political and economic environment is also exerting additional pressure on the panel market. This includes (1) Inflation problems caused by the rising oil prices. (2) The US credit rating downgrade by Standard & Poor’s Ratings from “stable” to “negative” has triggered fears regarding the future US economic outlook. (3) Due to the disastrous Japan earthquake, the country may experience an economic slowdown in 2Q11. (4) Portugal has officially asked the European Union for financial assistance. (5) Asian countries are introducing stricter policies in controlling the property market in order to avoid a possible housing bubble caused by their attempts in restricting the inflow of hot money. In short, these numerous negative factors caused the MCI index to fall by nearly 100 points during the past two weeks.