MP Materials Corp.’s stock skyrocketed in early trading Thursday, after the rare-earth producer said it inked a public-private partnership with the U.S. Defense Department to boost domestic magnet production and to reduce dependence on foreign sources.

MP Materials unveiled a multibillion-dollar deal with the U.S. government on Thursday to boost output of rare earth magnets and help loosen China's grip on the materials used to build weapons, electric vehicles and many electronics.

Shares of the mining company soared 50% in early trading at $45.10, while the S&P 500 and Dow Jones Industrial Average were flat and down 0.2%, respectively. The agreements includ