What happens when you get an industry leader reporting earnings that are nowhere close to as bad as the market thought after a 90% drop in the share price? Not only does that sector leader rise, but almost all players in the sector get to ride on the coat tails for one big rally.

We already highlighted how First Solar Inc. (NASDAQ: FSLR) managed to post considerably better-than-expected earnings. Shares were up big for a two-month-plus high in the afterhours trading session on Wednesday night. Now the gain has grown even more, and you know the report has to be sending the short sellers into the shadows. First Solar’s gain is up 25% at $18.50 so far today, and that will mark the highest share price in this battered solar leader going back to May 4.

The halo-effect is alive and well, if you just look at some of the moves in some of the key solar players today:

SunPower Corp. (NASDAQ: SPWR) is up 5.3% at $3.98, against a 52-week range of $3.71 to $18.28.

MEMC Electronic Materials Inc. (NYSE: WFR) is up 4.0% at $2.07, against a 52-week range of $1.44 to $7.26.

LDK Solar Co. Ltd. (NYSE: LDK) is up 7.5% at $1.375, against a 52-week range of $1.26 to $6.98.

The key solar ETF of Guggenheim Solar (NYSEMKT: TAN) is up 3.1% at $15.64, against a 52-week range of $2.42 to $34.12.

Unfortunately, the halo-effect is not lifting Suntech Power Holdings Co. Ltd. (NYSE: STP) due to its internal woes, which may be unrecoverable. Its shares are down about 6% more to $0.949 today.

JON C. OGG