Market Trend

Between March 16, 2009 to March 27, 2009, the MCI index leapt from 4789.6 to 5088.4, up by 298.8 points. After nearly 5 and a half months fluctuating below the 5000 level (the index fell below the 5000 mark on Oct 16, 2008), the market momentum has finally once again pushed the index back above it. Although the confidence level is still categorized by WitsView as “Very low” (to change from Very Low to Low, the index must return above the 6000 level), it is still symbolic, as 5000 was the initial starting point when WitsView created the index back in 2003.

As stated in WitsView’s previous report, the recent increases in the index has arised mainly from the influx of rush orders, thereby resulting in higher business activity in the general supply chain. A tighter panel supply and shortage of some components has led to a continuing inventory restocking by brand vendors. For the time being, WitsView believes this flurry of activity will persist. Thus, aside from staying above the 5000 level, there is also a big chance to see the MCI index increasing further in April.

In terms of the more longer-term TFT-LCD market outlook, a key point to pay attention to is the actual sales performance of China’s upcoming Labor Day holidays in May. If sales are strong, it will help spur another wave of restocking by brand vendors in preparation for the traditional strong third quarter. If no, it will further weigh on the brand vendors’ aggressiveness in their inventory preparations for 3Q09.