Time to start getting wary again as daytraders start to pounce on low end meat products such as solar. If this continues we might see dry bulk shippers up 50% tomorrow across the board. Or maybe it will be Chinese small caps circa October 2007 when they doubled every 3 days. Chinese solar stocks simply have to be the best sector ever, if you buy and hold you lose money 340 days a year but the other 25 you can triple your money in periods of 3-4 day increments. I don't have any value add here - the solar true believers can give you the scoop of why companies being obliterated on business metrics are "deep values" here.... there are general reports that China might subsidize solar, and as a rally gets longer in the tooth daytraders move down to more speculative areas... simple as that. I've been in this sector since late 2006 and that's just how they trade. Throw a dart and smile.
Two ways you can look at this - bulls can say the rally is widening out in a very broad way and speculative juices are back, bears can say when speculative merchandise starts to run like this we are getting very long in the tooth and approaching the last few innings of the rally. I am ambivalent but for your viewing pleasure....
(I believe David Einhorn of Greenlight Capital [hedge fund] owns JA Solar (JASO) so congrats) :)
NEW YORK (Dow Jones)--Shares of solar companies soared Thursday following a media report that the Chinese government is open to supporting the local development of solar energy in China. Asian technology newspaper DigiTimes said in an article Thursday that China hasn't yet designed a program or set a schedule for solar energy subsidies as costs of solar power generation are still too high. DigiTimes attributed the comments made at a Taiwan-China photovoltaic industry convention to officials from the Chinese Department of Renewable Energy. "This is consistent with what we have always heard and thought," Cowen & Co. analyst Robert Stone told Dow Jones Newswires, adding the news is still positive and is boosting shares. "The Chinese market could potentially be very large because China uses a lot of energy and demand grows with the economy." Gabelli & Co. analyst John Segrich said that while China has discussed renewable energy in the past, it usually focused on wind power. He added that the fact China is talking about solar power at all is a positive factor for the industry. "China has the potential to be a significant market," Segrich said. "It has gotten everyone excited." China-based solar companies traded up the most Thursday, as Cowen's Stone said China-based companies stand to benefit most from any Chinese subsidies. . "Chinese companies are also trading higher than other companies because up to now, they were trading at a discount to U.S. and international names," Stone said. "The valuation gap is closing somewhat today." Stone added that if the Chinese government began providing subsidies for photovoltaic products, it would benefit the solar market overall, though Chinese companies would be the biggest beneficiaries.
Did you like this article?
's
