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The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

By Ivan Martchev,



) -- The Nikkei has been brutalized in trading that has been attempting to price in the economic damage from the earthquake and tsunami. So far, the damage looks to be four to five times larger than the Kobe disaster -- and with several problematic nuclear reactors still in unstable condition, experts now fear overheating and a total meltdown of the nuclear rods.

We all hope that a Chernobyl-type catastrophe can be averted, but the situation is too unstable to predict at the moment. If we end up facing a worst-case scenario, the pressure on nuclear-related stocks should continue over the short term. The reaction is understandable, but erroneous, as without nuclear power the world's future energy needs probably cannot be satisfied.

In the next 10 years there are around 108 additional new reactors expected to be built, with 19 scheduled to be shut down, so the net addition of new reactors is substantial. China is building 42; India and Russia are building 12 each. The emerging world is going ahead with its energy plans regardless of what happens in Tokyo -- it has no choice.

And global instability also continues elsewhere in the world. Even though headlines have died down, the battle in Libya there rages on, and opposition leaders are sounding desperate, calling for air strikes on Gadhafi. With oil hovering near $100 a barrel, it is easy to dismiss the high price as a result of geopolitical tensions, but my long-term research indicates that we are likely facing much higher energy prices because oil simply will not be enough to satisfy the world's energy needs. This is yet another reason why uranium is here to stay.

The safest stock to bottom-fish with in the nuclear sector is


(CCJ) - Get Cameco Corporation Report

, as the majority of its contracts are done on a long-term basis and the company has very little exposure the volatility of the cash uranium market. Cameco will be supplying uranium long after the headlines from Japan die down. Other more speculative uranium names that I previously liked with more exposure to the cash market -- such as

Denison Mines

(DNN) - Get Denison Mines Corp. Report

-- are likely to underperform notably in the current environment.

Related Article: 5 Nuclear Energy Stocks to Buy Despite Japan Meltdown Fears

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The Japanese stock market has pretty much crashed, and with the central bank pumping record amounts of money into the economy, stocks will respond sooner or later as reconstruction efforts are likely to raise GDP growth.

It is difficult to call a bottom here as the reactors continue to overheat and explosions rock the nuclear complex. When the dust settles, however, Japanese small-cap stocks should do great as they tend to perform better in a rising inflationary environment with accelerating GDP growth. And that's what we're likely to see given what the Bank of Japan is doing. One ETF to consider purchasing on weakness is the

SPDR Russell/Nomura Small Cap Japan


. This is a buy-and-hold candidate to play the eventual economic resurgence driven by a reconstruction boom for the next couple of years.

Related Article: 5 Global Inflation ETFs to Buy Now

There are several closed-end fund that focus on Japan, which also may make good shopping-list candidates. The

Japan Small Capitalization Fund

(JOF) - Get Japan Smaller Capitalization Fund Inc. Report

tends to trade are substantial discounts to net asset value near important market lows -- last summer when the Japanese market was under pressure it traded at 8.6% discount -- which tend to close as stock trading normalizes. This week you may have such an opportunity to pick up JOF shares at a bargain price.

Related Article: 7 Japanese Stocks to Sell Now

Solar stocks saw notable investor interest on the news of the nuclear disaster as investors believed -- and rightfully so -- that alternative energies should see more serious consideration. But the solar sector is driven by government subsidies in a time of record deficits in most developed markets. There may be a short-term trade in the

Market Vectors Solar Energy ETF


, but I would not overstay my welcome past any quick gains over the next month or two. I don't see where the money for new subsidies will come from, and that is what ultimately will determine the fate of solar stocks.

Related Article: 5 Defensive Stocks for a Seller's Market

Ivan Marchtev is an editorial director for As of this writing, he did not own a position in any of the stocks named here.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.