Green Stocks Suffer Higher Losses Than Broader Market

On a day when the markets slipped badly, perhaps due to rising worries about an India-US trade deal, green stocks, with their higher valuations, suffered more than most. All stocks suffered losses, with none able to withstand the rising tide of selling pressure. 

With the day being the last trading day of the week, investors were clearly unwilling to carry forward bets to the next week, when so much is hanging in the air in terms of news that could move markets. Top of the list is obviously the India-US trade deal, which is still not closed despite the approach of the August 1 deadline. The news of other US deals, with Japan noticeably, has also indicated that negotiations are likely to remain tough. In India's case, it is becoming clear that agriculture and dairy might be the lines no one is willing to cross, leaving it to the US to take a call on doing business with India. On the other end of the scale, many hope that a deal will still come before the deadline and provide a fillip to Indian exports, much like they have through the India-US trade FTA. 

Be that as it may, it is clear that the renewables pack is suffering from an overhang of an unusually good monsoon that has depressed power demand growth, and fears of a contraction in margins across the chain. The news of the US opening investigations into more countries, including India, for solar module exports also slowed down interest in top manufacturers that seemed set to fly high only last week. 

All of this only served to underscore the higher-than-usual impact on the green pack from policy variables, which could no doubt weigh on valuations in an extended weak market now.

List of Green Stocks