Japan's Nuclear Fears Are Bearish for Uranium

 |  Includes: CCJ, NLR, SXRZF, URA
by: Emerging Money

By Tim Seymour

In the long run, Japan’s reactor crisis should put a floor on crude oil prices — especially if it scares other countries away from nuclear power.

By now you have almost definitely seen the latest headlines about the Fukushima reactor.

At this point, nuclear power accounts for about 20% of Japan’s electrical generation capacity. But even if the surviving plants come back online, it is now an open question whether the country’s ongoing brush with a meltdown will drive the government to turn its back on building new ones.

And with even the nuclear-friendly French now fielding internal debate over whether to abandon the nuclear dream in order to stave off similar disasters on their soil, this is another kick in the gut for nuclear power — and nuclear-driven stocks, especially in the uranium group.

Look to see the nuclear power ETF NLR open down at least 4% this morning.

And along much the same note, the uranium fund URA is not likely to fare well today or in the middle term — pressure here and on names like Caemeco (NYSE:CCJ) and Russia’s Uranium One, which primarily trades in Toronto but can be bought and sold here as (OTC:SXRZF).