Nuclear renaissance could fizzle after Japan quake


Even so, the perception of the industry is likely to suffer a severe setback, analysts said.

In 2007, GE combined its nuclear ventures with Hitachi on expectations of a nuclear renaissance in the coming years. The prevailing view was that concerns about carbon dioxide emissions and rising oil prices would push the world to look more favorably on nuclear power generation.

While the nuclear business is still just a small piece of GE's massive portfolio, investors could knock down its share price. The conglomerate built the Fukushima Daiichi Unit 1 reactor, where there was an explosion and radiation leak after Friday's quake and tsunami.

The backlash could also send shares of Cameco and Uranium One down sharply, after the uranium producers rose 55 and 100 percent, respectively, over the past eight months as investors bet on growing global demand for nuclear fuel.

The shutdown of 11 of the 54 operating reactors in Japan will likely depress the short-term market for uranium, with the country deferring deliveries and leaving producers with a surplus. The situation will only worsen as investor confidence sours on the overall future of the industry, pushing spot prices further down.

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