Solar shares and exchange traded funds counter-rallied last month on news of Germany’s healthy growth and improved sentiment for the beaten-down sector. The country is the world’s largest market of solar energy related products, but the sector may need more momentum for related ETFs to recapture their 200 day-moving-averages.
Last year was a flameout for the Guggenheim Solar ETF (NYSEArca: TAN), which lost 64%. The January rally in solar ETFs may be attributed to bargain hunters buying low and short sellers buying back shares, reports Trang Ho for Investors Business Daily. [Solar Energy ETFs Jump 12%]
Another ETF in this category is Market Vectors Solar Energy (NYSEArca: KWT).
German network Bundesnetzagentur announced recently that the country’s solar installations hit a record of 7.5 gigawatts, which is up from the 7.4GW seen in 2010. Solar power currently accounts for about 3% of the country’s total power. [ETF Performance Report: A January Rally]
Solar stocks are also poised to benefit from China’s plan to double its use of solar power, mostly with the use of solar panels.