The solar industry has been hit hard as the price of solar cells plummeted, but solar exchange traded funds have found a bright spot after leading solar firms reported strong quarterly earnings.
Now, the Guggenheim Solar ETF (NYSEArca: TAN) is trading 3.0% above its 50-day exponential moving average and Market Vectors Solar Energy ETF (NYSEArca: KWT) is 3.9% above its 50-day EMA, the first time either fund was above their short-term trends since February.
Earlier this month, First Solar (NasdaqGS: FSLR) revealed a 81% jump in second quarter profits. Additionally, GT Advanced Technologies (NasdaqGS: GTAT) also reported better-than-expected earnings. [First Solar Earnings Lift ETFs]
On Monday, the First Solar surged over 7% during trading, with volume at almost 7 million shares, compared to its average of 6.1 million, reports Bolton Flautt for Expedated.
GTAT increased 1.2% on Monday.
The two companies are among the solar ETFs’ largest holdings with, FSLR making up 7.8% of TAN and 13.0% of KWT and GTAT accounting for 6.8% of TAN and 8.5% of KWT.
Travis Hoium for Motley Fool argues that the uptrend in the solar industry is attributed, in part, to its strong balance sheets, along with improvements in more efficient and cost effective solar panels.
Guggenheim Solar ETF
For more information on the solar cell industry, visit our solar category.
Max Chen contributed to this article.