MP Materials Stock, USA Rare Earth Climb Amid U.S.-China Trade Spat

Key Takeaways

• Monday has brought more gains for shares of MP Materials and USA Rare Earth.
• Chinese regulators last week increased restrictions on exports that derive 0.1% or more of their value from rare earth technology. President Trump retaliated by boosting tariffs on Chinese imports.

U.S. rare-earths stocks are hot to start the week.

Shares of rare earth minerals providers MP Materials (MP) and USA Rare Earth (USAR) continued their recent climb Monday, rising after China took further steps to limit their exports to the U.S. Both companies' shares were up more than 20% in recent trading.

Chinese regulators, citing national security, last week banned exports that derive 0.1% or more of value from rare-earth technologies without government approval. That raised concerns about demand, lifting prices. Rare earth minerals are key to many high-tech industries, including chipmaking, and China is the top global producer. 

Why This Matters to Investors

A popular way to play an increased interest in rare earths necessary for various industries has been through shares of companies that produce them. Fresh uncertainty in U.S.-China trade relations, however, has meant more volatility for those shares—though on Monday, that volatility meant a big upward move for a few companies' stocks.

President Donald Trump retaliated, boosting tariffs on Chinese goods to 100%. He later appeared to back down, posting on Truth Social site “Don’t worry about China, it will all be fine!” and saying that China's President Xi Jinping “just had a bad moment.”

That news has lifted U.S. stocks broadly today, reflecting a measure of relief after Friday's news weighed on shares.

MP Materials shares had risen nearly 500% this year headed into Monday's session, while shares of USA Rare Earth had about tripled.  

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