Panel maker AUO surged on heavy buying, a strong day for panel stock holders but one that leaves the shares looking expensive.

• AUO rose more than 5% intraday and pushed past NT$30, with the day's biggest trading volume on the Taiwan market.
• Big institutions piled in the day before, making AUO their top buy, and that buying carried over.
• AI demand and new non-display uses for panels are pulling money into the sector.
• Taiwan's main index has been on a tear, jumping 775 points the previous session on record-sized foreign buying.
• The catch: the price is no longer cheap, and panel prices or end demand could soften again.

Outlook: The rally can keep running while institutions keep buying, but a pullback in panel prices or a reversal by foreign investors would hit the stock hard.