Solar Stocks Slip: Too Hot to Handle?
(Updated for rise in LDK stock price)
NEW YORK (TheStreet) -- Earnings have been strong from Chinese solar companies throughout the week, but that didn't help shares in the sector on Friday morning.
Inded, what had been a Tuesday-Wednesday-Thursday flare up for most of the solar companies, flared out early Friday morning, with all but one of the companies in the sector giving back gains from the preceding days' trading sessions.
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Options overnight on the sector were lower, suggesting a poor open today. Were investors overly optimistic on better-than-expected earnings in the sector this week, or was it just a few big short-term profit takers moving against the stocks to close out the week?In the end, the overbought/oversold debate could result in a weakness in stock price in some companies that actually have strong outlooks for the rest of the year and first quarter 2010. Suntech Power Holdings (STP) and Canadian Solar (CSIQ) led the downward spiral, with mid-morning losses of 4.7% and 4.9%, respectively. LDK Solar (LDK), which came into the day on positive overnight news that it had closed the previously announced sale of a 15% interest in its polysilicon processing plant for $219 million, was flat early in the session, but soon shot up over 2%, bucking the general downturn in the sector.
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