Molycorp (NYSE:MCP), Avalon (AMEX:AVL), Qiao Xing Universal (Nasdaq:XING), China Shen Zhou (AMEX:SHZ), Rare Element Resources (AMEX:REE) Soar on Rare

The rally in rare earths continue, and companies like Molycorp (NYSE:MCP), Avalon Rare Metals (AMEX:AVL), Qiao Xing Universal (Nasdaq:XING), China Shen Zhou Mining & Resources, Inc. (AMEX: SHZ) and Rare Element Resources (AMEX:REE) all soared in early trading, although some have now pulled back.

Every time a bit of positive news concerning the rare earths sector is released, it pushes the prices of the main players in the industry up in an inordinate move, which is of course good for traders.

This time it was the announcement by sector leader Molycorp's CEO Mark Smith, who said the company may double its production to meet the demand created when China decided to cut back on its rare earth export quotas.

Smith said, "We will be making some presentations in the first quarter to our board of directors on the economics involved of doubling production.”

Molycorp was trading at $59.96, gaining $2.46, or 4.28 percent, as of 11:37 AM EST. After pushing up on the news, Avalon Rare Metals got hammered, and is trading at $7.53, down $0.30, or 3.83 percent. This is probably because they were expected to possibly increase production to meet the growing demand. Qiao Xing Universal was trading at $2.98, up $0.17, or 6.05 percent. China Shen Zhou is at $10.28, up $1.98, or 23.86 percent. Rare Element Resources was also down to $16.82, falling 0.34, or 1.98 percent. They are down for the same reason Avalon is.