Stock Market Today: Trade Talks Start; Cannabis Stocks Burned 

Equities had trouble holding onto all their gains on Thursday, but it was eventful session in the stock market today. It was a volatile overnight session in the futures market, so the flat open in U.S. stocks came as a bit of a surprise Thursday morning.

Stock Market Today

By lunch, the SPDR S&P 500 ETF (NYSEARCA:SPY), SPDR Dow Jones Industrial Average (NYSEARCA:DIA) and PowerShares QQQ ETF (NASDAQ:QQQ) had tacked on gains in excess of 1%.

While stocks failed to carry those lofty gains into the close, the optimism comes as Chinese officials meet with U.S. trade representatives. The two sides are trying to iron out some of the easier agreements they see eye to eye on.

The continuous flow of headlines has kept investors on edge, although they generally seem upbeat given the market’s latest rally. Still, it’s not clear whether bulls or bears will wrestle control of equities. Largely, it will depend on how these current talks go.

Should it progress smoothly — and if an agreement is made — investors will likely be hopeful that the two sides can eventually come to terms with some of the more difficult trade-war issues later down the road. If they go poorly, a further correction would come as little surprise.

Cannabis Stocks Go Up in Flames

Hexo (NYSE:HEXO) shares fell more than 23% and hit new 52-week lows below $3 on Thursday. Igniting the move was a warning from management, as the company has experienced “lower than expected product sell through.”

As a result, the company had to warn about a fourth-quarter revenue shortfall. It now expects sales between $14.5 million CAD and $16.5 million CAD, well below consensus estimates of $24.8 million CAD. Hexo also pulled its 2020 estimate for up to $400 million in full-year revenue.

The news dealt a huge blow to Hexo shares, which are at their lowest levels since the first half of 2018 and down more than 65% from the highs. It’s also weighing on the cannabis space overall.

Canopy Growth (NYSE:CGC) is down about 10%, while Aphria (NYSE:APHA) slipped about 14%. Aurora Cannabis (NYSE:ACB), Cronos Group (NASDAQ:CRON) and New Age Beverages (NASDAQ:NBEV) fell between 5% and 7%.

Several cannabis stocks made the Top Stock Trades column Thursday.

Movers in the Stock Market Today

Apple (NASDAQ:AAPL) stock has been on watch all week, as we continue to look for a rally to new all-time highs. We got it (again) on Thursday, as shares pushed north of $230. Analysts continue to pile onto the bullish bandwagon, with Longbow the latest to do so. They upgraded the stock to a “buy” rating with a $260 price target.

Advanced Micro Devices (NASDAQ:AMD) shares were mostly flat Friday, as shares continue to drift sideways. Thursday’s sluggish action came even as analysts at Citic Securities initiated the stock with a “buy” rating and $35 price target.

While it’s not the most well-known research outfit on Wall Street, the price target is within the realm of other analysts and implies more than 20% upside to current prices.

PG&E (NYSE:PCG) shares plunged almost 30% on Thursday, as a new ruling puts bankruptcy fears back on investors’ minds. The judge will “allow for the consideration of alternative restructuring plans,” meaning an Elliott Management-led plan for bondholders is now technically possible. That could put $0 on the table for the equity price, which is being reflected in Thursday’s price action.

Following a spree of inspections, 38 Boeing (NYSE:BA) 737 NG jets have shown to have structural cracking needing repair. Overall, more than 800 jets were inspected, and of those, about 5% showed an issue with the pickle fork, which attaches the wings to the airplane.

Boeing reported the problem to the Federal Aviation Administration last month, while the affected planes could be out of service for up 60 days.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL.

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