Kazatomprom Shares Soar as Uranium Excitement Spreads to Asia
Commodity prices rallied after China’s central bank unveiled a package of stimulus measures
Shares in Kazatomprom have surged this week after a trio of events increased investor focus on uranium, underlining improved market sentiment regarding nuclear energy.
Shares in the world’s top uranium producer traded 9% higher at $38.98 in afternoon trading in Europe, paring the year-to-date loss to 7.7%.
Commodity prices rallied Tuesday after China’s central bank unveiled a package of measures to energize its ailing economy. This drove shares in European mining companies markedly higher, with majors such as Glencore, Anglo American, Rio Tinto and Antofagasta dominating the FTSE 100-index in London.
The China stimulus package followed Monday’s news that 14 major global banks and financial institutions pledged support to triple global nuclear energy capacity by 2050—a goal endorsed by 22 countries at the COP28 climate summit last December.
On Friday, Constellation Energy and Microsoft said they plan to restart Pennsylvania’s Three Mile Island, the site of the worst nuclear power accident in the U.S., to help power the tech giant’s growing artificial intelligence ambitions.
“The Constellation/Microsoft announcement on Friday clearly set things off, with a main focus on Western equities,” Per Jander, director of nuclear fuel and investor services at WMC, said.
Shares in Cameco, Canada’s top producer and the second-largest producer globally, and other Western uranium equities reacted well on the news, with the Saskatonian company closing Friday up 8.1%. Kazakh state-owned Kazatomprom ended Friday 0.5% down.
However, the China stimulus announcement seems to have spread the excitement to Asian equities, Jander said.
“After several months of soft investor sentiment in the sector, the uranium market is shaking off macro-related noise and refocusing on the very strong industry fundamentals,” John Ciampaglia, chief executive of metals-investment manager Sprott Asset Management, said.
For decades, nuclear energy was considered problematic by investors and regulators due to its spotted history of accidents, waste disposal concerns and construction delays.
However, it has recently emerged as a twin solution to both energy security concerns and decarbonization ambitions. In January, prices hit a 16-year high on supply concerns following production cuts from both Kazatomprom and Cameco.
“Generalist investors are starting to take notice of the important role of nuclear energy to meet the growing electricity demands from AI data centers, reshoring of manufacturing, EVs and defense industries,” Ciampaglia said.
In a June note, UBS analysts said a combination of strong, coordinated government backing—like that seen in China and India—and the accelerated construction of AI and data centers could rapidly accelerate nuclear energy expansion.
Near-term uranium near term prices were up 0.8% at $80.00 a pound on the New York Metal Exchange in afternoon trading in Europe.