Nuclear power was best performing theme in August
Despite a good week in global equities August was a bad month for our equity theme baskets with especially a lot pain in our energy storage, renewable energy, and green transformation baskets. The big story in the green transformation trade was the DKK 16bn impairment announced by Orsted due to supply chain costs, higher interest rates, and lack of progress in additional US tax credits all related to its US offshore wind projects.
Not all theme baskets related to energy have done bad in August. Our commodities theme basket was only down 2% in August outperforming the MSCI World Index driven by gains across many commodities including strong gains in crude oil. The best theme basket in August, and the only one gaining, was our nuclear power basket which increased 3.8% as prices on uranium continues to go higher with worries over the coup in Niger, home the seventh largest uranium mine in the world, adding to the pressure. Cameco, one of the largest global providers of uranium fuel, lifted their outlook in their FY23 Q2 results highlighting improving market fundamentals and increasing excitement from governments as nuclear power is increasingly seen a solution to decarbonize the global economy.
Adding to the nuclear power narrative, Sam Altman, co-founder of OpenAI, recently announced the intention to merge his small modular nuclear reactor company Oklo with a SPAC to go public under the ticker code ALCC. The fact that there is enough public investor interest in emerging nuclear power designs and technologies says a lot about how much the narrative around nuclear power has changed. We remain long-term positive on nuclear power.