Hydrogen fuel cell company Plug Power (NASDAQ:PLUG) is climbing higher on Tuesday, with shares up nearly 20%. However, without any news, what is responsible for the move in PLUG stock?
Well, investors may be able to thank electric vehicle play Nikola (NASDAQ:NKLA) for the move higher. Earlier in the day, the company tweeted that construction of its $600 million manufacturing plant was underway. Because this means trial production could start in the second or third quarter of 2021, NKLA stock is up slightly.
But why would the tweet from Nikola have PLUG stock performing so well in intraday trading?
The first phase of Nikola's $600 million electric truck manufacturing plant is on pace. Based on Nikola's current construction rate, trial production is anticipated to begin in the late second quarter or early third quarter of 2021. #NikolaManufacturingPlant #ManufacturingPlant pic.twitter.com/YJtYxBRPR2
— Nikola Motor Company (@nikolamotor) December 7, 2020
Importantly, top hydrogen plays have tended to move together in the market. Because Nikola represents the use of hydrogen fuel cells in the consumer vehicle and freight markets, it is reassuring the company is making progress. This is especially true after the company recently plunged. After several months in limbo, investors learned that General Motors (NYSE:GM) will no longer be taking an equity stake in the up-and-coming automaker. That sent NKLA stock falling, and it weighed on other top hydrogen names.
Now, with Nikola once again moving in the right direction, PLUG stock is reaping the benefits. However, there are a few other reasons Plug Power looks hot today.
PLUG Stock and the Clean Energy Catalysts
Over the last several weeks, the story for Plug Power and its peers has continued to heat up. Government bodies have released new clean energy promises. Legacy automakers are promising to electrify their operations. Tesla (NASDAQ:TSLA) is joining the S&P 500. Recovery in crude oil prices is boosting demand for hydrogen. Essentially, no matter where you look, someone is talking about hydrogen.
Even today we are seeing that play out. Earlier on Tuesday, Platinum Group Metals (NYSEMKT:PLG) was trending higher thanks to its role in green hydrogen production. Essentially, this more eco-friendly process is gaining investor attention. And importantly, it turns out that Plug Power is a player in the green hydrogen space thanks to its acquisition of Giner ELX. This surely is helping PLUG stock today.
Lastly, in just a few weeks, President-elect Joe Biden will take the White House. Leading up to Election Day, this possibility had environmentally conscious investors cheering. This is because the Democrat has promised to invest $2 trillion in clean energy initiatives. Importantly, many expect him to boost adoption of battery and fuel cell electric vehicles. This is why InvestorPlace analyst Matt McCall wrote recently that the time is now right for Plug Power and PLUG stock.
So what should investors do today? Take the Nikola catalyst with a grain of salt. Although the automaker is still an intriguing play, it needs some time to sort out the GM heartbreak. However, it is clear Plug Power and its peers shine on their own. Continue to follow the news in the hydrogen market and keep PLUG stock on your radar.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.