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The Highlights

A pause in interest rate hikes drove global equities higher. Last week, the MSCI World Index gained 2.64%, while the S&P 500 increased 2.22%. The S&P 500 earned its fifth consecutive positive week and is now 24.68% off its October 12, 2022, low. NASDAQ jumped 3.25% last week and is now up 30.79% YTD. NVIDIA (NASDAQ: NVDA) +192.13%, Meta (NASDAQ: META) +133.51, and Tesla (NASDAQ: TSLA) +111.51% have been the biggest contributors this year. The Russell 2000 was up 0.49%, marking its eighth straight weekly gain. Cannabis stocks did not participate in the rally and YTD the AdvisorShares Pure US Cannabis ETF (NYSEArca: MSOS) correlation to the S&P 500 is just 0.17. MSOS fell 1.26%, while Ascend (CSE: AAWH, OTCQX: AAWH) was the biggest loser, -8.57% on the week and -44.34% in 2023. The negative returns were surprising considering the good news that came out on Thursday. Cannabis Scheduling Review May Be Done This Year The Biden administration has expressed its intention to conclude the review of cannabis scheduling status by the end of this year. The review is focused on reevaluating the current classification of cannabis as a Schedule I substance. Schedule I drugs currently have no accepted medical value and a high potential for abuse. For perspective, tobacco killed more than eight million people last year and is not scheduled. Schedule I and II drugs are subject to the 280E tax code, which prevents businesses from taking tax deductions, outside of the cost of goods sold. According to Whitney Economics, this resulted in cannabis businesses paying $1.8 billion in additional taxes in 2022. Secretary Xavier Becerra, head of the US Department of Health and Human Services (HHS), said HHS, along with other agencies like the Drug Enforcement Administration (DEA), are, “working together to try to see if we can give the president an answer that’s based on the science and the evidence.” Stay tuned. We hope to be able to get there pretty soon—hopefully this year.