Critical Metals Shares Pop 27%, Other Rare Earth Stocks Extend Gains In Tuesday Pre-Market: What's Going On?

Shares of U.S. rare earth miners surged in premarket trading on Tuesday, extending a bumper rally from the previous session, amid U.S.-China trade tensions and JPMorgan‘s (NYSE:JPM) $1.5 trillion initiative.

Critical Metals Leads Gains

Shares of Critical Metals Corp. (NASDAQ:CRML) led the rally, surging 27.4%, after Blackboxstocks’ merger target, REalloys Inc., signed a letter of intent for a 10-year off-take agreement with the firm on Monday. Realloys plans to buy 15% of the expected rare earth concentrate from Critical Metals' Tanbreez Project in Southern Greenland, one of the world's largest heavy rare earth deposits.

USA Rare Earth Inc. (NASDAQ:USAR) climbed 12.36%, while MP Materials Corp. (NYSE:MP) was up 8.67% at last check. MP Materials Corp has been hailed as a successful venture by billionaire investor Chamath Palihapitiya amid its strategic importance, particularly its ties to the U.S. Department of Defense under the previous administration’s initiative to secure domestic rare earth supplies.

JPMorgan announced direct equity investments of up to $10 billion to address national security needs in sectors such as critical minerals and frontier technologies.

The U.S. lender’s CEO, Jamie Dimon, stressed the importance of the U.S. lessening its dependence on unreliable sources of critical minerals, products, and manufacturing. The bank plans to concentrate on four main areas, prioritizing critical minerals, and will assist companies through advisory services, financing, and direct investments.

China’s Rare Earth Curbs Spark Renewed Trade Tensions

The share moves come as investors keep a close eye on the potential for renewed trade tensions between the world's two largest economies.

China, which produces nearly 70% of the world's supply of rare earths from mines and processes almost 90%, recently tightened its grip on rare earth exports to protect its national security, escalating tensions with the U.S.

In retaliation, President Donald Trump on Friday announced the U.S. would impose new tariffs of 100% on imports from China starting from Nov. 1. The leader has since softened his stance, leading to renewed optimism in the market.

According to CNBC Commentator Jim Cramer, China is quickly adapting to the trade challenges posed by Trump’s tariffs and trade wars, and may now be less reliant on American markets than ever before.

The stocks also posted bumper gains on Monday. Critical Metals closed the session up more than 55%, while MP Materials rose 21% and USA Rare Earth climbed 18%.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.