U.S. Government Stake Sparks Rally in Lithium and Uranium Mining Stocks

Lithium Americas (LAC) surged 96% Wednesday following a Reuters report that the U.S. government may acquire a 10% stake in the lithium miner as part of a renegotiated $2.3 billion loan package. The potential state backing suggests implicit government support for the pre-revenue company, which isn't expected to generate income before 2027.

The rally spilled over to Energy Fuels (UUUU), a Colorado-based uranium miner unrelated to lithium production, which jumped 10.8% on parallel speculation. Market participants appear to be betting that uranium - like lithium - could attract similar strategic investment from an administration focused on securing domestic supplies of critical minerals.

Energy Fuels' American domicile may give it an edge over foreign competitors in any potential government partnership programs. While no concrete plans exist for uranium sector investments, the market is pricing in possible future policy support for domestic nuclear fuel production.