Uranium stocks jump for second day on Japan energy plans

Wed Feb 26, 2014 11:32am EST
 
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By Rod Nickel

Feb 26 (Reuters) - Shares of Cameco Corp, the world's third-largest uranium producer, jumped for the second straight day on Wednesday, rising with other uranium companies on optimism about Japan's plan to re-start reactors.

The release earlier this week of Japan's draft energy plan and the Japanese government's continued promotion of nuclear power has boosted sentiment for the sector, Dundee Capital Markets analyst David Talbot said in a note.

Uranium prices have been weak since an earthquake and tsunami struck Japan in March 2011, crippling the Fukushima-Daiichi atomic power plant, and leading it to shut down nearly all of its reactors. Prior to the disaster, Japan relied on nuclear power for nearly 30 percent of its electricity, according to the World Nuclear Association.

Cameco shares gained 4 percent in morning trading in Toronto, touching C$27.19, their highest price since mid-2011. The stock jumped 8 percent on Tuesday.

"We're hopeful there will be (Japan reactor) startups in 2014, but like everyone else, we won't know when or how many until they happen," said Cameco Chief Executive Tim Gitzel, speaking on Tuesday at a BMO Capital Markets investor conference in Hollywood, Florida. "This is a first of a kind process that we're seeing happen in Japan and we'll just have to see how it goes."

Shares of Australian uranium producer Paladin Energy Ltd climbed 15 percent in Toronto to 56 Canadian cents.

Uranium producers Energy Fuels Inc and Uranerz Energy Corp were also among the climbers, with early gains of 6 and 5 percent respectively.

Uranium exploration and development companies, who have struggled to attract investment with uranium spot prices low, also got a lift.   Continued...