Lithium Americas (LAC) Surges after Trump Admin Proposed Investment

Lithium stocks are on the move after Reuters reported that the Trump administration may be looking to acquire as much as 10% of Lithium Americas (LAC), sending shares soaring +95.7% yesterday with premarket trading pointing toward an even higher open today. The move would continue the President’s push toward major government investments in companies such as the computer chip maker Intel (INTC) and the rare earth miner MP Materials (MP), citing their importance for national security.

News reports say that the investment would be part of the renegotiation of a $2.26B Department of Energy Loan for LAC’s Thacker Pass lithium mine, which is a proposed mining project in Nevada at the largest known lithium deposit in the USA. Meanwhile, the only currently operating lithium mine in America is also in Nevada at Albemarle’s (ALB) Silver Peak project.

Lithium is viewed as a critical resource for modern technology, as it is a key component in batteries for electric vehicles as well as all kinds of electronics including cell phones and laptops. The metal is a coveted industrial material due to its high energy density, light weight, and ability to repeatedly charge & discharge without major degradation. Its importance is great enough to spark national security concerns, with the added layer of complication of diplomatic and trade tensions with one of the most dominant players in the field; China.

Looking at Lithium Americas’ chart, the recent sharp rally to 6.30 brought shares back to their highest mark since April, 2024. Price now finds itself near a notable set of old highs from October-November and March-April where price repeatedly topped out around 7.50 to 7.80. But shares are still down around -85% from their all-time highs of 41.56 from Dec., 2021 as of yesterday’s close. More potential resistance could be found at the 12.38 level, which marks the high point in Oct., 2023 after a major gap down. Meanwhile, the options market shows an expected move of about +/-2.35, or about 34%, for the Oct. 17 monthly expiration which is only 22 days out.

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