Market Trend

According to WitsView’s latest statistic data, MCI dropped by 301.8 points from 4821.3 points to 4519.5 points, from December 18th 2012 to January 17th 2013. MCI retreated for consolidation after reaching the near one-year high. When facing the situation of stagnant economy, governments in major nations announced accommodative policies such as quantitative monetary easing and expanding financial expenditures to spur economic growth. Following the U.S. and Europe, Japan plans to print yen and raise the inflation target in order to boost export competitiveness, by currency depreciation, and stir economic growth. China continues the “structure-tuning” and encourages real growth in domestic demand by carrying out “urbanization”.   

When observing the PMI for December, the U.S and China’s PMI stayed above 50, indicating the recovery expansion in the manufacture industry. Contrarily, the indicator in the euro zone was under 50, suggesting the euro zone still struggled in the contraction downturn. Generally speaking, the global economy shows frequent and unpredictable changes and fluctuations, the short-term benefits and long-term losses as well as asset bubbles brought by the monetary easing policies cannot be underestimated. In view of the weak end market because of stagnant global economy, the panel industry has to respond to rapid changes cautiously with the coming of slow season.            

As for the Taiwan-based panel makers’ revenue data in December, only Innolux contrarily showed the small growth of 2.4%, the remaining panel makers saw slight declines in monthly revenues. As the panel demand dropped along with the slow season, the panel prices also see pressure to reverse, and the correction scale will depend on the speed that the market digests the inventory and the capacity utilization status. Although the market will face a correction in H1’13, with the coming of peak season in the second half of the year, H2’13 is still worth expectation if the panel industry can carefully adjust capacity during the slow season.