Market Trend

Between June 8, 2009 and June 20, 2009, the MCI index decreased by 5%, from 5707.5 to 5374.6, down by 332.9 points; the drop in index broke the quarterly average for the first time since its gradual recovery in 2009. In June, growth rate of panel shipment is expected to be limited as panel makers were exposed to the influence of the shortage of upstream mother glass. Moreover, due to recent post-increase adjustments in the stock market, stock prices of the four major panel makers dropped by 4~7%, casting a downward spell on MCI for both monthly and quarterly average.

According to Witsview, there might be a potential risk of oversupply in the overall panel sector during 2H09 as new production lines continue to ramp up and component supply regains stability. Moreover, substantial fluctuations in panel pricing may result in decrease in demand from downstream clients, as well as escalation of market uncertainty, which may lead to skepticism of the third quarter as the traditionally strong season in the sector. Based on Witsview’s survey, in 2HJune, LCD panel will benefit from continual order placement from Mainland China to satisfy its domestic demand, leading to a 2~3% price increase, which may create a positive influence to the short-term performance of MCI index.