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Marijuana Stock Report: Pot Stocks Mixed As President Trump Neither Makes Friends Nor Influences People

By Brandon A. Dorfman
Jun 12, 2018

The North American Marijuana Index rose in a split decision on Monday, as pot stock investors in the U.S. and Canada diverged over the perceived outcomes of both recent and upcoming events on the world’s stage. Despite the recent passage of marijuana legalization Bill C-45 in the Senate, Canadian cannabis stocks dipped following tensions between the U.S. and several allies at the G7 meeting in Quebec this weekend. Meanwhile, on Wall Street, investors took a more hopeful approach on Monday, shrugging off the weekend’s events to go all in on the upcoming summit between President Trump and North Korean Leader Kim Jong Un.

The Index rose 4.86 points, or 1.78 percent, to end the day at 277.70, with the United States Marijuana Index gaining 5.31 percent and the Canadian Marijuana Index falling 1.46 percent.

Tensions were high in Quebec this weekend as President Trump, in an all too common scene angered U.S. allies by disrupting events at the G7 meeting while causing a row with fellow world leaders Justin Trudeau and Emmanuel Macron on Twitter. In a stunning, but not unexpected move, Trump called for Russia to be readmitted to the group, a request which was immediately blocked by Trudeau. The weekend ended with Trump disavowing a communique on tariffs and trade he had signed only hours before, leaving many to question America’s standing in the world.

Conversely, U.S. investors decided to blindly look past this weekend’s fiasco towards Tuesday’s off-again, on-again summit with North Korea, hoping that despite Trump’s boastful claims of not needing to prepare the U.S. President will somehow bring stability to region marred by conflict since the days of Harry Truman.

"With the G7 everyone knew there were issues going into it and probably nothing would get done," said Bucky Hellwig, senior vice president at BB&T Wealth Management in an interview with Reuters. "The focus is on the possibility of something good coming out of the Singapore summit."

Also affecting Canadian pot stocks is the current window of purgatory, with Bill C-45 now back in the House of Commons where legislators will decide whether or not to accept the nearly 50 amendments added onto the bill by Senators last week. Everything from the right of provinces to ban home-grown marijuana to an amendment forcing cannabis companies to publish lists of investors for public consumption is up for debate.

Wall Street is a bit anxious this week as investors look forward to upcoming meetings of the U.S. Federal Reserve, the European Central Bank and the Bank of Japan, with many expecting the Fed to raise key interest rates on Wednesday.

"With the (Fed's) rate increase we're going to get on Wednesday, we're going to be close to the core inflation rate," Hellwig told Reuters. "On the other hand, economic numbers look great."

The Dow Jones Industrial Average rose 5.78 points, or 0.02 percent, to end the day at 25,322.31, while the S&P 500 gained 2.97 points, or 0.11 percent, to close out at 2,782. Finally, the Nasdaq Composite Index rose 14.41 points, or 0.19 percent, to finish Monday at 7,659.93.

The Horizons Marijuana Life Sciences Index ETF (HMMJ.TO) fell CAD$0.30 per share, or 1.59 percent to end the day at CAD$18.60, and the Evolve Marijuana ETF (SEED.TO) closed out the day down CAD$0.20 per share, or 1.14 percent at CAD$17.40.

Canopy Growth Reaches Agreement With Bedrocan International

Checking in is Canopy Growth Corp. (TSX:WEED)(NYSE:CGC) who announced on Monday an agreement with Bedrocan International BV, ending their licensing arrangement. The agreement will see both companies end their previously announced arbitration proceedings as well.

According to a statement, Bedrocan will cease making and selling products by the end of the year, while Canopy will keep all associated licenses owned and operated by Bedrocan. Canopy will also retain the rights to Bedrocan’s licensed production facility and licensed sales facility. A moratorium is currently in effect in which Bedrocan can continue their business in Canada beginning in 2020.

Quick Hits

MPX Bioceutical Corporation (CSE:MPX) (OTC:MPXEF) completed the acquisition of Licensed Producer Canveda… Aurora Cannabis Inc. (TSX:ACB) (OTCQB:ACBFF) signed a cannabis flower and trim supply agreement with Ascent Industries Corp.'s wholly-owned subsidiary, Agrima Botanicals Corp… WeedMD Inc. (TSX-V:WMD) (OTC:WDDMF) secured its Health Canada Cultivation Licence for grow rooms in its Ontario greenhouse.

Canadian Public Cannabis Companies

New Frontier Data explores the cannabis stock market in Canada with a list of the top publicly-traded companies in the industry. As Canada prepares to become the first G7 nation to legalize marijuana, investors have been scouring the market, looking for the best plays. The full chart can be found below:


Courtesy New Frontier Data www.newfrontierdata.com

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