Friday Vernal Equinox
U.S. stocks went on the rally mode as investors and traders alike seemed to celebrate the first day of spring, aka Vernal Equinox. Unfortunately, it looks like at least one more taste of winter for folks in the northeast. Weather aside, stocks rallied today, ending a great week on a positive note. The S&P 500 closed up 0.90% to 2,108.
Cannabis stocks have not enjoyed the broad market enthusiasm, which is not surprising, but it remains disappointing. News was quiet and so was volume for the most part. Not surprising given the day of the week; Fridays are generally weak for the sector. Finally, something rational has occurred at the federal level around cannabis. Believe it or not, this time it was the IRS that extended a considerate shift in policy with Allgreens, a medical marijuana dispensary in Denver.
As we have noted several times, the fact that the industry faces so many restrictions in terms of banking has been a crippling issue. Also, these companies cannot write-off business expenses, which is difficult when trying to operate. However, the kick in the teeth was that they were fined for paying their federal taxes in cash, even though paying with a check wasn’t an option. While the IRS has refunded Allgreens, there’s no word on whether or not the IRS will refund other compliant cannabis businesses that pay their taxes in cash.