What happened

Shareholders of solar tech provider Enphase Energy (ENPH 2.09%) felt good for most of last week, but the gains they saw have disappeared in the last two trading days. Enphase closed Monday down 9.3% after being off by as much as 12% at the stock's low point in the session. However, this drop wasn't due to anything the company said or did. 

So what

In the last week of April, Enphase reported record quarterly revenue for the first quarter. The maker of solar panel system microinverters and related software also generated solid cash flow from operations and reported a strong gross margin. But investors generally are running away from the tech sector, and Enphase shares were apparently swept up in that sell-off again.

solar panel installers talk to customer couple in driveway.

Image source: Getty Images.

Now what

One factor that could have added to the slide in Enphase and other solar stocks Monday was the drop in oil prices, which fell nearly 7%. Typically, when oil prices decline, investors feel like the demand for renewable energy investments will drop. That negatively impacts stocks like Enphase. 

Oil prices were reacting to the idea the demand might continue to fall due to the ongoing COVID-19 lockdowns in China, as well as news that Saudi Arabia had lowered crude prices for some of its buyers over the weekend. But oil's dip on Monday must be kept in perspective. Oil prices have been spiking for months due to high demand and numerous supply constraints in place even before Russia invaded Ukraine. Crude remains above $100 per barrel. 

Enphase has even said it will focus on helping Europe during the crisis as numerous countries there work to establish a greater degree of energy independence. During its first-quarter earnings call, Enphase CEO Badri Kothandaraman said the company was "tripling down" on investing in Europe. Today, the company announced it will make its battery technology compatible with third-party inverters in a bid to help expand the growth of solar power systems. 

But Enphase stock wasn't trading on company news Monday. Rather, it was moving with the overall market, and in sympathy with the Nasdaq Composite Index, which dropped more than 4%.