By Matthew Carr
On Thursday, the East Coast braced for “bomb cyclone” Grayson.
Grocery stores were ransacked.
My best friend, a lifelong Maryland resident, wrote me: “100 eggs, 15 gallons of milk and 13 loaves of bread. We also have 100 pounds of salt… We’re fully prepared for our less than 1 inch of snow!”
Despite the country screeching to a halt because of a snowstorm, the broader markets continued to rally to new heights.
The Dow Jones Industrial Average topped 25,000. Hats were made signifying the milestone.
But underneath this good time, one sector was battling to gain control. Devastating losses piled up.
Losses triggered by a bomb going off on the East Coast…
The High Life
Weed stocks began 2018 with a bang.
On January 1, recreational pot use became legal in California.
Dispensaries met the new year with long lines of patrons. For them, it was the busiest day on record. And businesses saw sales bumps that exceeded their wildest expectations.
News cameras caught all the happy action. Sure, I didn’t understand why some of the customers were hugging each other like some great enemy had been defeated… but whatever.
People were happy.
This sparked renewed interest in marijuana from investors across the country.
In a move reminiscent of the recent blockchain boom, the eager beavers went out and bought anything marijuana related.
One of our researchers sent me a note saying Google searches for “weed” and “cannabis” that day exceeded the volume of searches on April 20 – the unofficial marijuana smoking holiday.
In fact, the last time queries for “weed” and “cannabis” were this high was November 9, 2016 – when everyone was Googling to see if California voters had legalized recreational cannabis use.
High on the prospect of weed profits, investors plowed into the sector.
So it’s no surprise weed stocks blazed higher to start the year…
The Horizons Marijuana Life Sciences ETF (TSX: HMMJ) – which holds 20 marijuana-related companies – shot up as much as 35% between December 28 and the close on January 3.
The ETFMG Alternative Harvest ETF (NYSE: MJX) – which switched in December from Latin American real estate to cannabis companies – shot up as much as 23%.
At the same time, the Cannabis Stock Index, made up of 75 companies, surged 26.8% higher.
Even in my newsletter, Oxford Resource Explorer, our Canadian marijuana positions shot up as much as 72.6% during just that five-day span. And we don’t recommend penny stocks.
Investors were blitzed about the possibilities.
They didn’t even pay attention to the marijuana market last year, even though we had a fantastic run as we waited for the mainstream to “get woke” to what was on the horizon.
In 2016, North American legal marijuana sales increased 34%. And the market is projected to grow 26% per year until 2021.
We’re talking about a potential $23 billion market by then.
California, which boasts the world’s sixth-largest economy, joins Alaska, Colorado, Nevada, Oregon and Washington state in legalizing recreational pot sales.
Plus, they’ll be joined by Maine and Massachusetts later this year.
But I still don’t believe in U.S. pot stocks. And Thursday demonstrated why.
[iu-adbox]
A Dose of Reality
Marijuana is …read more
Source:: Investment You
The post How Jeff Sessions Killed the U.S. Pot Stock Rally appeared first on Junior Mining Analyst.