Quarterly Outlook
Equity outlook: The high cost of global fragmentation for US portfolios
Charu Chanana
Chief Investment Strategist
Chief Investment Strategist
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Nuclear energy stocks are experiencing a significant resurgence, propelled by escalating electricity demands from AI data centers, supportive regulatory shifts, and strategic partnerships with tech giants.
The U.S. government is signaling strong support for nuclear energy. President Trump has included nuclear energy in his recent executive orders and appointed nuclear advocate Chris Wright—a former board member at SMR developer Oklo—as Energy Secretary. Wright has named the “commercialization of affordable and abundant nuclear energy” as one of his department's top priorities. Reports also indicate plans to invoke the Defense Production Act to reduce dependence on foreign uranium and expedite domestic reactor approvals. This policy pivot aims to bolster national energy security and stimulate the nuclear sector.
The rapid expansion of AI technologies and data centers is driving unprecedented electricity consumption. With solar and wind facing storage and reliability challenges, nuclear energy's consistent output positions it as a viable solution to meet this surging demand.
Major tech companies are entering long-term agreements with nuclear energy providers to secure sustainable power sources. For instance, Amazon Web Services acquired a data center powered by Talen Energy's Susquehanna nuclear plant, highlighting the tech sector's commitment to nuclear energy. Meta has also signed a 20-year nuclear deal with Constellation Energy to meet its AI ambitions.
France, Japan, South Korea, and even China are accelerating nuclear plans. Attendance at the Nuclear Energy Institute’s finance summit surged 50% this year—evidence of fast-rising institutional interest.
While the long-term story looks promising, investors should tread carefully. The nuclear sector carries significant risks: