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U.S. Solar Stocks & ETF Surge on Tariff News

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U.S. solar stocks rallied during Tuesday's trading session after the Trump administration imposed steep tariffs on solar imports from four Southeast Asian nations. First Solar (FSLR - Free Report) shares rose around 10.5%, Sunnova Energy (NOVA - Free Report) gained 26.6%, and SolarEdge Technologies (SEDG - Free Report) jumped 7.9% on April 22, 2025.  Invesco Solar ETF (TAN - Free Report) gained 4.5% on April 22, 2025.

Tariffs Target Southeast Asian Imports

The U.S. Department of Commerce announced duties of up to 3,521% on solar panel imports from Cambodia, Malaysia, Thailand, and Vietnam. This follows an investigation into claims that Chinese companies were funneling solar products through these countries to sell in the United States at artificially low prices—posing a threat to domestic solar manufacturers.

Some of the harshest penalties were directed at Cambodian imports, with tariffs exceeding 35 times the cost of the products. In contrast, some goods from Malaysia will face lower tariffs, starting below 35%.

Disruption to Global Supply Chains

The announcement sent shockwaves through the global solar supply chain. The newly imposed tariffs are expected to raise the cost of imported panels, which many U.S. solar installers and developers had previously relied on to keep costs low. With imports now far more expensive, American-made panels are poised to become more competitive.

Great News for U.S. Solar Manufacturers

This policy shift is seen as a major win for U.S. solar manufacturers. Higher import costs could give domestic producers a competitive edge, potentially increasing their market share and pricing power.

Investor Optimism and Market Reaction

The surge in solar stock prices reflects investor optimism about the future profitability of American solar companies in a more protectionist trade environment. Traders are betting that U.S. firms will benefit from rising demand for domestic products.

Solar ETF TAN in Focus

The underlying MAC Global Solar Energy Index is comprised of companies in the solar energy industry. The fund’s top three holdings are First Solar (11.39% weight), Enphase Energy (11.13%) and NEXTracker (9.46%). The fund charges 67 bps in fees and yields 0.57% annually.

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