Japan looking sunny for makers of solar panels

The Times
June 20, 2009

Robert Lindsay

Talk that the clouds were finally lifting from the world’s solar power market helped to make PV Crystalox Solar, the long-suffering solar supplier, the second-best performer in the FTSE 350.
Kyocera Corp, of Japan, the world’s sixth-largest solar panel maker, triggered the sunny mood when it reported a 50 per cent increase in orders for rooftop panels from households in January to April.
Japan is the remaining hope for PV Crystalox, which supplies panel manufacturers such as Kyocera with wafers. The Japanese Government has moved to bolster demand for solar panels and next year hopes to guarantee prices for surplus electricity produced by home panels. No one knows if this will be enough to counteract falling demand from Europe, but Kyocera said that there had been improvement in European orders. Sharp, PVC’s biggest customer, recently predicted that its solar panel business would return to profit next year, amid a surge in demand from Japan.

David Cunningham, an analyst at Arbuthnot, reiterated “buy” advice with a 160p target. PVC rose 8p, 10 per cent, to 89¾p.
The FTSE 100 closed up 65.07 points at 4,345.93 amid high-volume trading, with banks and commodity stocks on the rise. Most traders refused to trust the move since it came on “triple witching” day, when futures and options expire and funds must close positions and reinvest.
There was a sudden rise in the index in mid-morning, rumoured to be driven by frantic buying by a fund that had missed an auction. The FTSE 350’s top gainer was Mitchells & Butlers as Joe Lewis, the Bahamas-based billionaire, who has been critical of the pub group’s management, raised his stake from 21.7 to 22.3 per cent.
Carnival, the cruise ship operator, continued to recover after its outlook statement on Thursday, which was better than expected, gaining 97p to £16.68. Aviva, the insurer, was bolstered 18½p to 336¾p by a “buy” note from Deutsche Bank, which lifted its price target from 350p to 385p.
Smiths Group fell 14½p to 649p, making an 11 per cent slide over the week, amid concerns over the weak dollar and slow orders for its detection business and medical products, which are squeezed by hospital budget cuts.
British Airways rose 1.9p to 136.4p despite rising crude prices amid suggestions that shareholders might not object if it followed Air France-KLM, which on Thursday announced a €575 million convertible bond issue.
Taylor Wimpey, up 3p at 34p, led a housebuilders’ rally after saying that there were signs of housing market stability. Berkeley Group rose 18½p to 773p despite Saad selling down more of its stake.
Rightmove, the home search website, rose 4¼p to 350p after it briefed analysts that the number of estate agents closing had dropped sharply and that it believed house prices will increase next year. Cannacord, the broker, raised its target price to 387p.
• New York: Microsoft offered encouragement to Wall Street as its shares rose 2.6 per cent after Goldman Sachs’ announcement that it expected growth from the software group. The Dow Jones industrial average was at 8,556.13 points, up 0.53, at midday.