Molycorp (NYSE: MCP) shares fell 5% in after-hours trading Tuesday following the company’s quarterly earnings as profit and revenue both came in well short of expectations.

The stock dropped about 7% in Tuesday’s regular trading.

The bearish action in Molycorp hit the $500 million Market Vectors Rare Earth/Strategic Metals ETF (NYSEArca: REMX). The ETF counts Molycorp as its third-largest holding at about 7% of the fund.

The rare earths ETFs managed to close Tuesday flat despite the sell-off in Molycorp ahead of the quarterly results. The fund has gained about 13% in 2011 to outperform the broader market.

The first quarter is “typically characterized by slow buying and depressed activity in China due to its New Year celebrations,” said Mark Smith, Molycorp chief executive, in the earnings release.

“In spite of this, and in spite of the natural catastrophes experienced by Japan in the first quarter, we continued to see strong global demand for our products,” the CEO said.

Market Vectors Rare Earth/Strategic Metals ETF

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