U.S. to Impose Lower-than-Expected Tariffs on Chinese Solar Producers; TAN ETF Jumps
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Solar stocks rallied sharply Tuesday afternoon following a preliminary decision by the Commerce Department related to its countervailing duty investigation of PV cell imports from China. The Global Solar ETF (NYSE: TAN) surged more than 4 percent following the mid-day announcement.
Chinese producers will now be forced to pay US tariffs in order to offset the Chinese government's subsidies. Suntech (NYSE: STP) will be required to pay a 2.9 percent tariff while Trina Solar (NYSE: TSL) will need to pay a 4.73 percent tariff. The remainder of the Chinese solar-equipment manufacturers will need to pay a 3.61 percent rate.
The probe was initiated following a complaint by a unit of SolarWorld AG and six other US producers which claimed peers in China had an unfair advantage given subsidies from the Chinese government.
Traders in the sector may be cheering the news as previous rumors had suggest a US tariff would be closer to 10 percent.
Around the solar sector:
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Chinese producers will now be forced to pay US tariffs in order to offset the Chinese government's subsidies. Suntech (NYSE: STP) will be required to pay a 2.9 percent tariff while Trina Solar (NYSE: TSL) will need to pay a 4.73 percent tariff. The remainder of the Chinese solar-equipment manufacturers will need to pay a 3.61 percent rate.
The probe was initiated following a complaint by a unit of SolarWorld AG and six other US producers which claimed peers in China had an unfair advantage given subsidies from the Chinese government.
Traders in the sector may be cheering the news as previous rumors had suggest a US tariff would be closer to 10 percent.
Around the solar sector:
- Suntech shares closed up 14 percent;
- Yingli (NYSE: YGE) closed up 12 percent;
- Trina Solar closed up nearly 8 percent;
- Canadian Solar (Nasdaq: CSIQ) up 6 percent; and
- JA Solar (Nasdaq: JASO) up 4.4 percent
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