U.S. Solar Energy Shines After Sanctions on China

A raise in tariffs against China caused a big bump in Sunpower Corporation and other US solar companies' stocks.
5:00 | 06/04/14

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Transcript for U.S. Solar Energy Shines After Sanctions on China
Michelle Franzen in New York as Wall Street closes on Wednesday June 4 mrs. stories jobs. Today -- why the sun is shining brightly on American solar stocks thanks to a move by the US Commerce Department here. What happened Aaron task of Yahoo! finance. Aaron why was this such a good day on Wall Street for American solar -- Well the US government is imposing big new sanctions on Chinese solar panels. And that was gave a big boost his -- powered First Solar and the the whole USB solar sector. And this is something is going back to you a first round of tariffs in 2012. And then the -- government. You know looked at -- at another complaint from ironically a solar company that's based in Germany but operates are United States and saying that. And the Chinese Government is unfairly subsidizing their solar companies are then dumping their stuff -- United States. You mentioned SunPower is one of the US makers of profit in the course of this news -- take a look at the -- -- chart. Walk us through what happened for SunPower and other American panel makers. Right well it's a great day if you own SunPower corporation are few are that company -- -- for solar. Another big American son solar company -- have about 4% today. Because the US government is saying hey we're gonna help you compete. -- -- Chinese companies and on the flip side -- solar which is a Chinese based solar company treats -- in the United States. Down about 4% so the the financial markets making a very. Directed on ambiguous comment on who this is good for -- it's bad for at least when it comes to the stock. And the Department of Commerce says -- found evidence China was artificially lowering its panels pricing. Walk us through that well. And I mean look it it's it's a bit ironic to say why the Chinese Government is subsidizing solar industry and they're doing in an unfair way I don't know what the fairway would be. This is basically had that Chinese operated almost every industry. This has been an issue with solar again going back at least when he twelve. There's been complaints from the United States from Germany from other members the WTO that -- China isn't playing by the rules. I think the Chinese look at -- like hey this is what we do. And so they are saying that the United States has -- ignored the facts and you know is is unfairly trying to help United States solar company so this is. You know what becoming a tit for tat these verbal battle between United States and China and it's going to -- -- In areas far beyond solar as well and that's something that investors. Should definitely pay attention to him. And along with that statement of calling the move -- ignoring the facts the Chinese ministry of commerce responded. Saying quote it's an abusive trade remedies can we expect tit for tat and trade action from Beijing. You know I think we can -- I think it's a concern especially for major US technology companies. I would say the solar tariff battle -- -- -- the undercard for the main event which is the Chinese Government is taking a very hard line. -- US based technology companies in including our corporate parent Yahoo! but also FaceBook and Google Cisco and IBM. In the week of the NSA spying revelations that Edwards -- wouldn't -- last year -- -- kind of using that as a pretext to say hey wait a minute you know US technology companies. There in the with the government and they're spying on Chinese. Citizens Chinese companies and so we have -- You not buy their products but by Chinese made technology. Products and there also say hey you guys think you guys are -- -- hypocrite you can tell us what to do. Look at the kind of set the NSA is doing and so. -- a trade wars a very strong term especially in Wall Street but I do fear that the the rhetoric is certain to heat up -- him in a way that could be very bad. Not just for the stock market but for relations between US and China and that could have major global economic ramifications. -- yet but I think that's the word. He -- -- trade in general but -- expect next. Before these clouds clear on the solar dispute. Well I think this is the the big open question right now I mean again so this some of the language -- that the Chinese daily which is a state run newspaper used -- says. You know US companies and apple marks up who FaceBook or coordinating with the NSA program to monitor China and that we must resist the -- Internet. And have a G imagines he's been dropped international regulations history technology safeguards. We will also severely -- the pawns of the -- So they're coming -- -- -- villain in the colonies technology companies -- of the villain. Are they gonna make it much more difficult for American technology companies operating China that's a big question. It's a big question for those companies of the big questions for our country and it certainly going to be a big question for investors it seems -- you know that they're talking tough. -- the Chinese take further action that's going to be really well we'll know whether this is anything more. That is the lot of empty words. It's something that's bills out beyond the solar panels issued today. -- task of Yahoo! finance thank you for joining us. And of course you've been watching -- story stocks stay with abcnews.com for your latest headlines I'm Michelle Franzen in New York.

This transcript has been automatically generated and may not be 100% accurate.

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