markets

J. Edward Moreno

2/24/25

Canadian weed companies fall after Germany elects cannabis-hostile chancellor

German voters elected conservative Friedrich Merz to be their next chancellor, a political shift that may threaten Canadian cannabis companies that have increasingly been focused on exports as growth in the domestic market plateaus.

Canadian cannabis companies like Tilray, Aurora Cannabis, and Canopy Growth export cannabis to countries in Europe where it is regulated. Merz has said that if elected, he would reverse cannabis legalization in Germany, the largest economy in Europe.

Cannabis stocks, particularly Tilray, fell on the first trading day since the election in Germany. Cannabis imports to Germany have swelled since they’ve been allowed in 2017, reaching 34.6 tons in 2023, according to data from the country’s Federal Institute for Drugs and Medical Devices.

Pardon the German, but you can see how much imports (in kilos) have been rising in the chart below.

Federal Institute for Drugs and Medical Devices

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DEVELOPING PROBLEMS

Concerns about rising government debt are not strictly an American problem

Global government debt piles are swelling to record levels. That’s an issue for many nations, but developing countries may be most at risk.

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16m

RH slips after missing Q2 estimates and trimming its outlook amid cost pressure

Restoration Hardware shares dropped Friday morning after the luxury furniture brand missed Q2 estimates and tightened its full-year outlook.

Adjusted earnings per share came in at $2.93, below the Street’s estimate of $3.21. Revenue was $899.2 million, also missing analysts’ forecast of $905 million.

RH now expects full-year revenue growth of 9% to 11%, down from prior guidance of 10% to 13%, as margins get squeezed by tariffs and weakness in the housing market. Wall Street had been looking for about 10% growth this year.

The retailer is taking steps to blunt cost pressures, including shifting sourcing away from China. RH expects receipts to fall from 16% in Q1 to 2% in Q4, with vendors absorbing a meaningful portion of the tariff impact. RH is also boosting US manufacturing capacity in North Carolina and pushing back a new concept launch to next spring.

RH shares are down about 43% year to date.

markets

2h

Super Micro rises as the company begins shipments of Nvidia Blackwell chips

Super Micro Computer jumped over 6% in premarket trading on Friday after the company announced it has started shipping “Plug-and-Play (PnP)-ready” racks powered by Nvidia’s new Blackwell Ultra chips, giving data center customers a ready-made option to scale up their AI infrastructure.

The rollout enables what SMCI calls “turn-key day-one” operations, with the entire racks preassembled and tested to work out of the box.

“Data center customers face many AI infrastructure challenges: complex network topology and cabling, power delivery, and thermal management,” CEO Charles Liang said. “Through Supermicro Data Center Building Block Solutions with our expertise in on-site deployment, we enable turn-key delivery of the highest-performance AI platform — critical for customers seeking to invest in cutting-edge technology.”

The company says the new system’s performance jumps up to 7.5x over Nvidia’s previous-generation chips. It’s also designed to run more efficiently, using less power and water while taking up less floor space, cutting the overall operating costs by 20%, according to the statement.

The launch comes after a rocky August, when SMCI’s shares plunged on weaker-than-expected quarterly results and management trimmed its annual revenue target.

Investors in Super Micro have endured much volatility this year, as the company has failed to deliver on multiple occasions. Even so, the shares are up nearly 50% year to date.

Electricity inflation hits highest level in two years as AI boom rumbles on

Is your power bill going to kill the AI trade?

AI data center electricity

Nia Warfield, Luke Kawa

S&P 500, Nasdaq 100 post record closing highs as nearly everything rallies

The benchmark US stock index ended up 0.9%, the Nasdaq 100 rose 0.6%, and the Russell 2000 outperformed with a 1.8% gain.

Bull charging across sand creating dust cloud

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