LDK Leads Rally in Solar Stocks as Baidu Extends Declines

LDK Solar Co. (LDK) led a rally in Chinese solar manufacturers in New York on prospects demand will increase in 2014. Baidu Inc. fell to the lowest in three weeks.

LDK, the second-biggest maker of solar wafers, jumped to a two-week high while Yingli Green Energy Holding Co. rose the most in a week. Baidu declined for a third day after the Japanese government warned of security leaks through programs made by companies including the Chinese Internet company. The Bloomberg China-US Equity Index of the most traded Chinese stocks in the U.S. slumped 0.2 percent to 104.41 yesterday.

Average prices for polysilicon, the key raw material for making solar panels, rose to the highest level in 14 months in the past week, according to data compiled by Bloomberg. China’s government solar energy plans indicate as much as 12 gigawatts of new capacity in 2014, and the Finance Ministry issued in November a policy encouraging solar power distribution. Demand for solar panels in Mexico will more than triple next year to 250 megawatts, GTM Research said last week.

“China, Japan and the U.S. will be the biggest solar buyers next year and there will be steady growth for the industry,” David Smith, the manager of the Gabelli Green Fund at Gamco Investors Inc., said by phone from Rye, New York. Next year “could be a defining year for solar because you’re starting to see significant amount of market adoption. Right now we are seeing great market demand, we are seeing costs come down.”

ETF Slumps

The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., dropped 0.8 percent to $37.64 in New York, retreating the most in a week. The Standard & Poor’s 500 Index climbed 0.5 percent in a fourth day of gains as a drop in U.S. jobless claims fueled optimism in the economy.

LDK’s American depositary receipts advanced 2.2 percent to $1.40, the highest close since Dec. 10. Trina Solar Ltd. (TSL), based in Changzhou, added 0.9 percent to $13.14 in New York for a 203 percent surge in 2013.

Yingli Green, the biggest solar-panel maker, climbed 1.1 percent to $13.14, extending its rally this year to 97 percent. A group of companies led by the Baoding-based company’s unit won an order to provide 233 megawatts of solar panels to projects in Algeria, Yingli said in a statement last week.

2014 is expected to see a 25 percent growth in volume in the global market with “minor” price reductions, according to a report issued by Bloomberg New Energy Finance Dec. 2.

NQ Mobile Inc. (NQ), an Internet security company based in Beijing, jumped 7 percent to $12.25, the highest price since Dec. 9. AutoNavi Holdings Ltd., a Chinese digital map content provider, rallied 2.9 percent to $14.56 in New York, gaining the most since Dec. 4. Trading volume was 1.8 times the 90-day average compiled by Bloomberg.

Security Leaks

Baidu (BIDU), China’s biggest online search engine, slipped 0.8 percent to $167.28, the lowest level since Dec. 3. The slump pared its gain this year to 67 percent.

Japan’s government warned that certain software used for writing Japanese characters could lead to security leaks. The country’s Foreign Ministry removed software programs made by Baidu from five PCs at its Tokyo headquarters, spokesman Makoto Higashiyama said yesterday. The ministry said it’s instead using programs made by Tokyo-based Justsystems Corp. and Microsoft Corp.

Sohu.com Inc. (SOHU), a provider of online news, video and games services, dropped 2.7 percent to $70.60, slumping the most in two weeks. Its shares have advanced 49 percent in 2013.

The Shanghai Composite Index (SHCOMP) slid 1.6 percent to 2,073.10, the lowest since August. The Hong Kong market was closed yesterday for the Christmas holiday.

To contact the reporter on this story: Belinda Cao in New York at lcao4@bloomberg.net

To contact the editor responsible for this story: Tal Barak Harif at tbarak@bloomberg.net

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