USA Rare Earth Inc. (USAR) stock surged 5.47% in pre-market trading on Thursday, outpacing the broader rally in rare earth stocks. The significant uptick comes as investors react to a newly announced agreement between the United States and China on rare earths and critical minerals.

U.S. President Donald Trump revealed that he has reached a one-year agreement with China regarding rare earths and critical minerals following a meeting with Chinese President Xi Jinping in South Korea. This development has sparked optimism across the rare earth sector, with several companies seeing notable gains in overnight trading.

The agreement, which will be renegotiated annually, is expected to have far-reaching implications for the rare earth industry. President Trump also announced a reduction in tariffs on Chinese exports from 57% to 47%, further easing tensions between the two economic powerhouses. With plans for reciprocal visits between the leaders in the coming months, investors are anticipating continued dialogue and potential cooperation in the critical minerals sector, boosting confidence in companies like USA Rare Earth.