MP Materials Stock Jumps As US Mulls Cold War-Style Rare Earths Strategy - Retail Sees Smooth Sailing Ahead

Shares of MP Materials Corp. (MP) jumped 8.5% in aftermarket trading on Thursday, building on a nearly 14% gain during the regular session, on news that the U.S. is weighing new measures to strengthen its rare earth minerals supply chain.

According to a Bloomberg report, U.S. President Donald Trump's administration is looking to implement Cold War era measures to raise funding for rare earth minerals projects.

Officials are reportedly considering using the Defense Production Act to unlock funding, loans, and other support for rare earth-related projects, from mining and processing to downstream technologies, in a move to develop a robust supply chain.

The discussion on rare earth minerals has been central to the trade war between the U.S. and China. In response to President Donald Trump's broader tariffs on goods, Chinese President Xi Jinping suspended exports of a broad range of rare earths and related magnets in April.

The decision disrupted global supply chains vital to automakers, aerospace firms, semiconductor makers, and military contractors. 

However, earlier this week, Trump announced that China has agreed to resume supplying“full magnets and any necessary rare earths” following trade discussions between the two countries in London.

Last week, Morgan Stanley upgraded MP Materials stock rating to 'Overweight' from 'Equal Weight' while increasing the price target to $34 from $23. The ratings change sent MP shares up 5.5%.

The brokerage firm lauded MP Materials' focus on managing the critical rare earth minerals supply chain, believing that it is the most vertically integrated rare earth metals company ex-China.

Retail sentiment toward the MP Materials stock among Stocktwits users remained 'extremely bullish', accompanied by 'extremely high' message volumes.

One user posted that the stock could soon rise to $100.

Another user believes it'll be clear sailing if the stock surpasses its resistance level at $35.

Year-to-date, MP Materials stock has gained over 87%.

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