Donald Trump’s sweeping election win on Wednesday triggered a sharp drop in European clean energy stocks following his anti-wind energy stance.

Trump vowed to end “horrible” wind turbines during a campaign rally on May 11, 2024, in Wildwood, New Jersey, promising to issue an executive order to terminate these projects on his first day in office.

The market reaction was swift. Danish offshore wind giant Orsted saw its shares fall up to 14 percent, while wind turbine makers Vestas and Nordex dropped by around 11 percent and 7.6 percent, respectively.

A Reuters report quoted Alphavalue analyst Pierre-Alexandre saying, “The key message is that uncertainty is back,” as the US renewables sector is a crucial growth area for European utilities such as Portugal’s EDP Renováveis, Orsted, and Germany’s RWE.

According to the report, completely overturning Biden’s Inflation Reduction Act (IRA), which provides substantial subsidies and incentives for clean energy technologies, would require congressional action, yet significant alterations might still be possible.

Despite the market turmoil, companies expressed resilience. Vestas and Orsted indicated on Tuesday that they expected US demand for green energy to keep expanding, irrespective of the election outcome.

Speaking to Reuters, Angelo Meda, head of equities at Milan’s Banor SIM, called Orsted’s sharp drop an “overreaction” and used the opportunity to increase his position in the stock. “Thinking that the green energy transition trend is completely over seems irrational,” he told the news agency.

Nordex also struck a cautiously optimistic note on the US onshore wind market, though a spokesperson acknowledged that policy uncertainty could delay some customer decisions.

Shares of other major players in the sector were hit as well: RWE fell 6.6 percent, while EDP Renováveis dropped 11 percent. The iShares Global Clean Energy Index sank 6 percent, hitting its lowest since mid-2020.

As the dust settles on the election results, the broader implications for the clean energy sector remain to be seen.

(With inputs from Reuters)