Increase in CNRG sizzling solar stocks


OWith strong support from solar stocks, clean energy stocks and related exchange-traded funds surged on Thursday after China eyes a major economic stimulus and amid talk that the United States will cap tariffs on solar panels. Canadian solar products.

Among the ETFs that reacted to these headlines, the SPDR Kensho Clean Power (CNRG) ETF jumped nearly 5%. CNRG, which tracks the S&P Kensho Clean Power Index, is not a dedicated solar ETF, but it has credible exposure to the industry, including among its top 10 holdings. In other words, the CNRG has ample leverage on positive solar energy news, including trade between the United States and neighboring Canada.

These two countries are among the leaders in the adoption of renewable energy and have “shared objectives and commitments to combat climate change”, and the elimination of tariffs will bring “stability and predictability to our renewable energy sector and will strengthen North American competitiveness,” said Canada’s Minister of Commerce. said Marie Ng.

A warm business relationship, especially with a neighboring country, is positive, but certain factors could be catalysts for CNRG and renewable energy assets in the future. For example, data from the U.S. Energy Information Administration (EIA) indicates that April was the first time solar and wind power generated a larger share of electricity in April. American than nuclear. In the fourth month of the year, renewable energies represented 29.3% of the electricity produced in the United States, a record.

“U.S. solar generation between January and April 2022 increased 28.9% year-over-year, the analysis found, while coal-fired generation declined 3.9% and the nuclear by 1.8%”, reports Jules Scully for PVTech.

However, coal remains the primary energy source in the United States, confirming that there is still ample room for growth for CNRG components exposed to sun and wind. Solar rollout has been somewhat delayed in the first three months of 2022 due to previously existing tariffs, but ahead of news from Canada, the White House has said it will lift commercial levies on certain solar products made in the Southeast Asian countries.

As for China’s potential impact on renewable energy assets, Beijing is floating the idea of ​​a $220 billion infrastructure stimulus package via debt sales to prop up the world’s second-largest economy.

“The government’s growth target for 2022 looks increasingly hard amid Covid resurgences and a housing downturn. Economists polled by Bloomberg predict the economy will grow 4.1% this year,” according to Bloomberg.

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