Ra­di­a­tion fears prompt price drop

Townsville Bulletin - - Investor -

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.

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