Solar Stocks Are Rallying, With Boosts from Tesla and China

Solar stocks jumped on Wednesday, with SunPower Corp shares leading the way after the solar-power company unveiled a deal with Tesla, Inc. for stationary batteries.

The sector also got a boost from news that China, the world's leading maker of panels and other solar-power products, was planning measures against a price war.

Shares of SunPower (SPWR) jumped 14%, taking some of the sting of deeper losses in recent months. So far this year, the stock is down 35%, compared with an 11% advance for the S&P 500 index SPX.

Earlier Wednesday, SunPower, which focuses on residential solar, said it hammered out a deal with Tesla $(TSLA)$ to offer the company's Powerwall, a stationary battery.

"Homeowners are increasingly turning to battery storage to protect themselves against ongoing utility rate hikes and grid outages," SunPower said, adding that it seems a future where almost all solar systems are paired with storage.

Other stocks rallying Wednesday included those of First Solar Inc. $(FSLR)$ and Canadian Solar Inc. $(CSIQ)$. The Invesco Solar ETF TAN gained more than 9%.

In China, the country's Photovoltaic Industry Association said in a recent WeChat post that it would crack down on below-cost prices of solar equipment and materials, according to a Bloomberg report.

The post mentioned a May 17 meeting that included the attendance of an official from the Ministry of Industry and Information Technology, the report said.