The North American Marijuana Index closed mixed on Tuesday, as U.S. pot stocks dipped following news that Canopy Growth received approval to uplist on the New York Stock Exchange.
Asked why they chose the New York Stock Exchange over the NASDAQ, Canopy Growth Corp. (TSX:WEED) CEO Bruce Linton stated, "Ultimately one of them is on Wall Street and has a bit more history and cache, and the neighbors on it are pretty substantive companies." In other words, for Canopy, it’s all about appearances.
On Tuesday, Canopy received word that their application to list on the NYSE was accepted, making them just the second pure-play cannabis stock to list on a major U.S. stock exchange —the first being Cronos Group (NASDAQ:CRON). In a short letter to the company, the famous exchange wrote, “The New York Stock Exchange certifies its approval for listing and registration of the Common Shares, no par value of Canopy Growth Corporation under the Exchange Act of 1934,” thus bringing Canada’s largest Licensed Producer off of the OTC markets for U.S. investors.
On Wall Street, the market fell despite the bill’s passage as trade talks with China broke down one day after Treasury Secretary Mnuchin assured investors that a trade war would be put on hold. The President also continued to stumble his way through the ZTE Corp issue, having yet to make a deal following accusations of pay-to-play with the Chinese government over the intelligence community’s least favored phone company.
Topping off the trading day, President Trump stated there is now a "substantial chance" the planned North Korean summit will not take place on June 12.
"As day worn on, Trump's comments about North Korea and not having a deal with ZTE just brought people back from yesterday's euphoria into more of a reality that this issue with trade is not going to end as quickly as many had thought," said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in an interview with Reuters.
"So you're seeing a little bit of giveback," he continued.
The Dow Jones Industrial Average fell 178.88 points, or 0.72 percent, to end the day at 24,834.41, while the S&P 500 fell 8.57 points, or 0.31 percent, to close at 2,724.44. Similarly, the Nasdaq Composite dipped 15.58 points, or 0.21 percent, to end the day at 7,378.46.
The Horizons Marijuana Life Sciences Index ETF (HMMJ.TO) rose CAD$0.39 per share, or 2.18 percent to end the day at CAD$18.27, while the Evolve Marijuana ETF (SEED.TO) gained CAD$0.36 per share, or 2.08 percent to close out the day at CAD$17.69.
MedMen Enterprises broke ground on a high-tech cannabis factory in Desert Hot Springs, California… Cannabis Wheaton Income Corp. (TSX-V:CBW) announced a $100 million bought-deal financing… Cronos Group Inc. (NASDAQ, TSX-V:CRON) will uplist in Canada to the TSX.
Why Legalizing Marijuana Is Stuck In Legal Limbo
The tug-of-war between federal and state laws concerning legal marijuana dates back to a little-known provision in the 1970 Controlled Substances Act known as The Preemption Clause. While back then, President Richard Nixon hoped to use the law to divide the electorate to help win elections, today the law continues to cause chaos across the United States. Watch below, as CNN gives a history lesson on how a little-known provision in the Controlled Substances Act continues to wreak havoc on marijuana law today:
Note: An earlier version of this story incorrectly reported that a version of the SAFE Banking Act passed the House as part of larger rollbacks of Dodd-Frank last night. In fact, while the amendment was proposed, it was never passed. Banking issues remain a problem in the cannabis industry today.