Radiation fears prompt price drop
AUSTRALIAN uranium stocks plunged for a second straight day amid heightened fears of a nuclear meltdown in Japan following last week’s earthquake and tsunami.
Another explosion yesterday at the Fukushima reactor, 220km f r o m t h e n a t i o n ’ s c a p i t a l , prompted Japanese Prime Minister Naoto Kan to warn that substantial amounts of radiation were leaking in the area, triggering waves of panic selling across global financial markets.
‘‘ There’s just so much uncertainty. Nobody bar a few nuclear experts actually know what’s happening, which is the scary thing,’’ IG Markets market strategist Ben Potter said.
‘‘ Some reports are saying winds could blow low level radiation into Tokyo in 10 hours, while others dismiss the fact.
‘‘ Either way, the world’s worst nightmare could be unfolding.’’
CMC Markets sales trader Ben Taylor said speculation that a n u c l e a r c l o u d wa s f l o a t i n g towards Tokyo city had terrorised the markets.
‘‘ Further rumours of another flash crash coming has seen value thrown out the window as panic selling sets in across world equity markets,’’ Mr Taylor said.
Investors sold out of Australian uranium stocks in droves as yesterday’s trading session ground on amid a greatly weakened outlook for the sector.
Shares in Rio Tinto Ltd – majori t y o wned Energy Resources of Australia Ltd ( ERA), t h e w o r l d ’ s f o u r t h l a r g e s t uranium producer, plunged to a six-year low after dropping 12 per cent on Monday. ERA was down 14.3 per cent, at $ 7.07, its lowest since January 2005.