On Monday, those gains were largely gone — wiped out by an escalating trade war between U.S. and China that has American stocks careening toward the biggest drop of the year. As good as last week’s earnings were, the solar industry remains a high-risk bet in Wall Street’s eyes, leaving it vulnerable to big swings when the broader market turns, said Kit Konolige, an analyst at Bloomberg Intelligence.

“It’s inherently a high-risk type of business,” Konolige said. “They’re vulnerable to China tariffs, as well as policies on taxes and renewable energy.”

The MAC Global Solar Energy Index, which tracks solar companies globally, was down as much as 5.9% on Monday. That’s after it gained 6% last week, capping the biggest rally since April.

Panel maker SunPower sank 13%, just four days after a better-than-expected earnings outlook sent its shares rallying by the most in more than six years.

“The rally was excessive,” Pavel Molchanov, an analyst at Raymond James.
Molchanov said in an interview. “We’re now seeing some appropriate profit-taking.”

Inverter manufacturer Enphase, which surged to a record last week after posting its highest-ever quarterly revenue, also slid, falling 8.3%. First Solar Inc. was down 8.1%.