Article content continued
So far, the reaction to the election has been mute. Cannabis stocks are widely selling off, pre-market despite the success at the polls. Canopy Growth Corp.’s NYSE listing is down more than five per cent and Aurora Cannabis Inc., Cronos Group Inc. and Tilray Inc. have each shed more than four per cent.
The negative trade appears to be linked to the increasing likelihood that the Republicans will hold onto the Senate. That could make federal legislation much harder to come by.
7:47 a.m. — Futures are pointing to a strong day for technology and the Nasdaq
The markets usually hate — and I mean hate — uncertainty of any kind during an election. In 2016, after it was clear that Trump had won, futures plunged by around 1,000 points before reversing course. So it’s a bit puzzling to see the opposite has occurred here. Although Dow futures briefly declined 400 points after Trump’s late night speech, the rest are in the green and pointing to what could be a strong trading day.
S&P 500 futures are up 0.57 per cent or 19 points, while Nasdaq futures have climbed more than 250 points or 2.29 per cent. Dow futures, meanwhile are still slightly negative.
As of now, the Senate looks like it’ll remain red. Oanda senior market analyst Edward Moya explained in a note this morning that that means Americans will likely not see tax hikes and tougher regulation — two of the key points in Biden’s platform that investors were worried about. They also won’t see massive stimulus spending, he said, and in that environment, the Nasdaq will continue to outperform as “the great cyclical rotation won’t happen anytime soon.”
