As of 4:21 p.m.:

Closing S&P Sectors

Nasdaq 100 Heat Map

Advance-Decline Intraday vs. SPY

Closing Volume and VIX

- NYSE volume 4% above its one-month average

- NASDAQ volume 4% below its one-month average

- VIX index: down 10.66% to 24.05

Breadth

S&P 500 Sector ETFs

% Movers

I have doubled my TerrAscend (TSNDF) position in the last week.

From March 7th:

TerrAscend for the Long Term

TerrAscend Corp. (TSNDF) is a leading cannabis multiple state operator.

All cannabis equities are speculative but for the reasons mentioned in my Daily Diary over the last two months, the industry's upside reward vs. downside risk may have finally turned profoundly positive. While it is unclear that rescheduling and regulatory reform are in the offing over the near term, it is likely inevitable, in our view.

As for TerrAscend, the shares trade at only $0.41/share (size accordingly!) and at a market capitalization of only $146.4 million and have the potential to be a 5-bagger in the years ahead (and in the fullness of time). This is an investment and not a trade.

TerrAscend, as noted by in the above tweet by my friend and cannabis expert Anthony Varrell, is starting to separate itself from the pack.

Fourth-quarter results were ahead of internal forecasts (in some measure because of the implementation of a company-wide ERP system delivering a meaningful reduction in general expenses of nearly $3.6 million in Q4 2024). This led to the tenth consecutive quarter of positive operating cash flow and the sixth consecutive quarter of positive free cash flow.

TerrAscend is forecasting that selling general and administrative expenses will be shaved by $10 million in the current fiscal year.

New Jersey (#1 in state) and Maryland were regional highlights for the company. The company's large cultivation presence in Pennsylvania augurs well if adult recreational use is passed, which is being supported by Governor Shapiro.

Importantly, unlike many of its debt-ridden (and illiquid) brethren, this cannabis company does not face a debt maturity cliff as most of TerrAscend's debt matures in late 2028 (having attractively refinanced $140 million in Q3 2024). As a result, this cannabis company is well-positioned to acquire state dispensaries and to execute transformational mergers and acquisitions (and expand its sales footprint). These transactions will likely be cash flow and earnings accretive. Its acquisition pipeline is "robust" with multiple opportunities.

It can also buy back stock. Here is what Executive Chairman Jason Wild said on this subject on last night's conference call:

"2024 represented marked just the fifth year anniversary of our operating in the U.S. If you said to methen that we would report $74 million in quarterly revenue, over 50% gross margins and positive cash flow I would have been pleased. If you then told me the stock today would be down by more than -90% from where it was pre revenue in the U.S. I am not sure I would have believed you. I would have been very disappointed. And I am very disappointed. To that point in August the company announced our first ever $10 million buyback demonstrating our confidence in the future and our committment to enhancing shareholder value. Considering improved operating performance in our existing businesses, strength of balance sheet, $150 million of owned real estate (with no sales/lease backs), the potential for Pennsylvania to convert to adult use and greenfield expansion opportunities we believe our equity is significantly more undervalued now than last August. We intend to act on that belief in the coming days."

I have gotten to know TerrAscend and its management team over the last few years. The team is sober, disciplined and focused.

I will have a more thorough analysis of TSNDF in the next week or so but I would advise doing your own homework. Start by reviewing the company's Q4 2024 EPS release and listening to the company's Q4 conference call. 

By Doug Kass Mar 7, 2025 7:20 AM EST

JeffI

Tariffs are for losers.

Great information on tariffs from Bookvar. Ty Dougie!

Worth repeating…

“In the debate over tariffs, the good thing is that we don't have to go back too far for evidence of its impact. In December 2019 the Federal Reserve released its economic study on the steel and aluminum tariffs slapped on in 2018. Here is what they said, "A key feature of this analysis is accounting for the different ways that tariffs could affect manufacturers in the presence of global trade and supply chain linkages. On the one hand, US import tariffs may protect some US based manufacturers from import competition in the domestic market, allowing them to gain market share at the expense of foreign competitors. On the other hand, US tariffs have also been imposed on intermediate inputs, and the associated increase in costs may hurt US manufacturers' competitiveness in producing for both the export and domestic markets. Moreover, US trade partners have imposed retaliatory tariffs on US exports of certain goods, which could again put US firms at a disadvantage in those markets, relative to their foreign competitors."

Ok, this sounds like an exact replica of what we are dealing with right now. Their conclusion, "We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices. For manufacturing employment, a small boost from the import protection effect of tariffs is more than offset by larger drags from the effects of rising input costs and retaliatory tariffs. For producer prices, the effect of tariffs is mediated solely through rising input costs."

Finally, "While one may view the negative welfare effects of tariffs found by other researchers to be an acceptable cost for a more robust manufacturing sector, our results suggest that the tariffs have not boosted manufacturing employment or output, even as they increased producer prices. While the longer-term effects of the tariffs may differ from those that we estimate here, the results indicate that the tariffs, thus far, have not led to increased activity in the US manufacturing sector."

Dougie Kass

i so admire peter's body of work.

and he is a warm and thoughtful friend, jeffi.

Bought small indices on the selloff:

* SPY $559.10

* QQQ $476.49

I have to leave at about 3:30 p.m. to pick up my car from the service center.

A heads up. 

* Home, home in the range

* Is the S&P chart stuck in the middle with you?

Well, I don't know why I came here tonight

I've got the feeling that something ain't right

I'm so scared in case I fall off my chair

And I'm wondering how I'll get down the stairs

Clowns to the left of me

Jokers to the right

Here I am, stuck in the middle with you

- Stealers Wheel, Stuck in The Middle With You

S&P Index

* A sawtooth pattern will likely remain...

I bought a lot of merchandise with the S&P in negative ground this morning.

With S&P cash +45 handles (and $70 handles from the days lows) I am taking off some of my Index longs to move close to being delta neutral on SPY and QQQ.

Here are some things I did today:

* Index buys: SPY $556.34 and QQQ $474.57

* Financial buys: BAC $39.59, C $67.55 and JPM $228.91

* Technology buys: AMZN $196.54, GOOGL $164.55 and MSFT $380.97

* Cannabis: MSOS $2.79, VRNOF $0.69 and CRLBF $0.75

* Sold HOOD $38.51.

* Bought more JOE $44.15.

MRKT Call with Dan and Guy at 11 a.m.!

Be there or be square - and it's free!

Tech Stocks Rebound: Trust The Bounce?

Next buy tranche with S&P cash -21 handles.

- NYSE volume flat with its one-month average;

- Nasdaq volume 2% below its one-month average

- VIX down 3.53% to 25.97

Back buying JOE at $44-ish.

From Monday:

The St. Joe Company Shareholder Sale

(Bruce Berkowitz, a large shareholder of ) (JOE) ( has recently sold some stock.)

My guess is that his fund is having redemptions - but I can't be sure.

Meanwhile, here is a good analysis of the company can be found at https://www.undervalued-shares.com/.

Position: Long JOE common M; Short JOE calls S

By Doug Kass

Mar 10, 2025 9:35 AM EDT

With the S&P Index up by only +11 handles (retreating dramatically from the morning's highs) I am adding across-the-board to my longs..

* Read as much as possible - for if you read enough you can assemble a circle of smart friends from the past as well as the present.

* Do your own homework.

* Invest, learn and live by a disciplined process.

* Remain skeptical of consensus (always and not only at cycle tops).

* Consider your sources.

"The chains of habit are too light to be felt until they are too heavy to be broken."

- Warren Buffett

My primal twitter posts over the last week were more than just rants.

The posts represented some more important observations and lessons we must always learn. We should not have to wait to relearn these lessons until after the gold rush, when the tide goes out after our portfolios are damaged.

Too many, worshiping at the altar of price momentum, forget many of these conditions and factors in each and every cycle:

Bottom Line

Read as much as possible, for if you read enough, you can assemble a circle of friends from the past as well as the present.

Listen to those lessons from the brilliant who have been among us and not to made up B.S. narratives in the business media (from sources whose knowledge base is miles long, but only inches deep).

Prefer, over the fugazi crew, those icons like Bernard Baruch (here are some of his pearls):

“Don’t overestimate the courage you will have if things go against you.” 

“Consider all the facts – meditate on them. Don’t let what you want to happen influence your judgement.” 

“Do your own thinking. Don’t let your emotions enter into it. Keep out of any environment that may affect your acting on your own reason.”

Finally, do your own homework, learn and live by a disciplined investment process, remain skeptical of consensus (always and not only at cycle tops) and consider your sources.

* Oops....

From Peter Boockvar:

We've seen this movie before and should not have a different ending/Commodities/Sports and those seeking value

You've heard me argue this year that so goes the Mag 7 stocks, so goes the US dollar because of the large holdings of them by foreigners. Here is a chart of the MAGS ETF and the DXY over the past year.

MAGS in white, DXY in orange

In the debate over tariffs, the good thing is that we don't have to go back too far for evidence of its impact. In December 2019 the Federal Reserve released its economic study on the steel and aluminum tariffs slapped on in 2018. Here is what they said, "A key feature of this analysis is accounting for the different ways that tariffs could affect manufacturers in the presence of global trade and supply chain linkages. On the one hand, US import tariffs may protect some US based manufacturers from import competition in the domestic market, allowing them to gain market share at the expense of foreign competitors. On the other hand, US tariffs have also been imposed on intermediate inputs, and the associated increase in costs may hurt US manufacturers' competitiveness in producing for both the export and domestic markets. Moreover, US trade partners have imposed retaliatory tariffs on US exports of certain goods, which could again put US firms at a disadvantage in those markets, relative to their foreign competitors."

Ok, this sounds like an exact replica of what we are dealing with right now. Their conclusion, "We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices. For manufacturing employment, a small boost from the import protection effect of tariffs is more than offset by larger drags from the effects of rising input costs and retaliatory tariffs. For producer prices, the effect of tariffs is mediated solely through rising input costs."

Finally, "While one may view the negative welfare effects of tariffs found by other researchers to be an acceptable cost for a more robust manufacturing sector, our results suggest that the tariffs have not boosted manufacturing employment or output, even as they increased producer prices. While the longer-term effects of the tariffs may differ from those that we estimate here, the results indicate that the tariffs, thus far, have not led to increased activity in the US manufacturing sector."

The US Treasury market knows all of this and can mostly explain why yields have fallen and the curve has reinverted when looking at the 3 month and 10 yr.

Here is the study, https://www.federalreserve.gov/econres/feds/files/2019086pap.pdf

By the way too, here is a chart of the CRB raw industrials index, putting in a classic bottom and is just a hair below a 2 yr high. We're long and bullish commodity stocks, including our favorite right now, silver.

CRB Raw Industrials Index

Silver

Meanwhile, with respect to the continued rise in Japanese JGB yields, Governor Ueda basically said today that they are not going to fight it right now but could if it gets more unstable. "My understanding is that the rising trend since last year reflects the market's views on the economy and inflation or shifts in interest rates overseas. There is no major gap between our views and the market's." Then followed it up with this, "If long-term yields rose sharply in a way that differs from normal market movements, we would conduct operations swiftly and flexibly to promote stable interest rate formation in the market."

The yen is weaker today but after its big rally to below 150.

To some earnings calls.

From Dicks Sporting Goods:

Q4 comps grew by 6.4%, "driven by growth in average ticket and in transactions" after a comp gain of 2.9% in 2023 and 5.3% in 2022. It was their outlook though that was more muted "which balances the strong confidence we have in our strategic initiatives and operational strength against the dynamic macroeconomic environment."

On their customer and clarifying their muted guidance, "We are not seeing a weaker consumer now. We're coming off a fantastic Q4. Our guidance merely reflects the fact that there's so much uncertainty in the world today in the geopolitical environment, macroeconomic environment, we are just being appropriately cautious. And I would give you a couple of other data points about our consumer and why we actually feel optimistic. Our consumer has proven that in times of stress and uncertainty, that they are leaning into outdoor, being outside going for a run or walk, or play, watch team sports, it's become much more of a necessity than a discretionary item. And it makes sense because it is a way for people to find calm in an otherwise uncertain timeframe."

And nothing beats sports. "The other thing why we feel great is that sports are having a huge moment in the US...this is a nation that is obsessed with sport. And that's only going to continue as we have all of these major events on US soil."

From Kohl's on their consumer and something that is a continued theme:

"from a macro perspective, you see a pretty decent bifurcation among income level. We don't see it too much geographically per se, but when you look at income level, if you're making less than $50k, that consumer is pretty constrained from a discretionary standpoint. If you're making less than $100k, it's also pretty challenging. And you see that very clearly in numbers. And obviously we hear the inflation numbers. We know they're coming down to 2% to 3%, but they're still pretty elevated particularly from a grocery and rent perspective over the last few years because they haven't actually deflated. And, I'm not sure wages have kept up with that...You definitely see that in them, they're seeking out value. You see it in the mix of the product we're selling, you see it in the promotions that we are doing. They're definitely seeking value."

Cruising/travel is still going well as heard from Viking yesterday:

"2025 is shaping up to be a great year. Also demand for our core products remain strong. As of February '25, we were already 88% booked for the year, with $5.3 billion of advanced bookings. These are 26% higher than the 2024 season at the same point in time."

Finally, with a further drop in mortgage rates to an average of 6.67%, purchase applications rose 7% w/o/w after a 9.1% rise in the week before that followed four weeks in a row of declines. Refi's were higher by 16.2% w/o/w after jumping by 37% last week.

Jefferies cuts PEP from buy to neutral.

Most active premarket ETFs as of 8:39 a.m. ET:

Premarket percentage movers at 8:57 a.m.:

Upside:

-SSP +34% (earnings, guidance)

-GRPN +22% (earnings, guidance)

-SFIX +12% (earnings, guidance)

-RBRK +8.7% (Rosenblatt Securities Inc. Raised RBRK to Buy from Neutral, price target: $77)

-CXM +6.8% (earnings, guidance)

-RKLB +6.7% (files $500M stock shelf; intends to acquire laser communications provider Mynaric; selected by Airbus to provide high-efficiency solar panels for 100 OneWeb LEO satellites for Eutelsat)

-INTC +5.4% (TSMC said to have 'pitched' Nvidia, AMD and Broadcom about taking stakes in a JV that would operate the foundries of Intel)

-ABM +5.0% (earnings, guidance)

-PLTR +4.9% (to host its sixth AIPCon on Thursday, March 13th)

-TSLA +4.2% (bounce off recent selling)

-SIDU +3.9% (signs MOU with Warpspace to Launch Joint Venture to Develop Advanced Optical Space Communication)

-COMM +3.7% (launches its Propel XFrame solution as the latest addition to the Propel portfolio of high-performance data center solutions)

-SMCI +3.5% (introducing a wide range of new systems which are fully optimized for edge and embedded workloads)

-EBS +3.1% (announces investment agreement with Rocketvax and pursuit of a strategic relationship for next-generation product candidates)

-ABM +2.8% (earnings, guidance)

-NVDA +2.6% (TSMC said to have 'pitched' Nvidia, AMD and Broadcom about taking stakes in a JV that would operate the foundries of Intel)

-ZIM +2.4% (earnings, guidance)

-TNXP +2.1% (confirms TNX-1500 shows promise in preventing Organ Transplant Rejections of Either Human or Pig Organs, as evidenced by Feb 2025 TNX-1500 Phase 1 Trial topline results)

Downside:

-IRBT -34% (earnings)

-ZYXI -34% (earnings, guidance)

-VRA -21% (earnings, guidance; Co-founder Barbara Bradley resigns from Board)

-DTC -20% (earnings; discloses substantial doubt about its ability to continue as a going concern)

-LDI -11% (earnings, guidance)

-NVO -4.9% (Roche-Zealand obesity collaboration announcement)

I am covering more PEP (-$3.25) at around $149 in the premarket.

HOOD is trading +$2.50 in premarket. I have taken a profit in my HOOD rental (sold at $38.81) in premarket concerns after looking at yesterday's company (monthly) metrics:

* The company saw an 8% month-over-month decline in EOP AUC

* A competitor, IBRK's monthly margin loans dropped in February, so I would question whether margin loans and other retail trading indicators could face weakness at HOOK this month.

* Transaction based revenue and earnings estimates will be reduced at HOOD.

This table is a valuable resource for momentum-based short term traders:

From JPMorgan:

US: Futs are higher into CPI with Tech outperforming. An acceleration of the Trade War is not impacting global Equities. Pre-mkt, Mag7 are all higher ex-AAPL, same pattern as yesterday. Bond yields are flat to down 1bp, and USD is flat. Cmdtys are stronger led by Energy and Metals with Ags under pressure. The macro data focus is on CPI where the whisper number appears to be below BBG consensus, but the print is important to shape the market narrative with a hotter print producing stagflation worries and a cooler print likely to assuage recent econ concerns.

and...

EQUITY AND MACRO NARRATIVE: There was some late day volatility as Bloomberg headlines indicated that US/Canada are going to have discussions on USMCA ahead of the Apr 2 tariff deadline. As part of that discussion, Canada is suspending the 25% tariff on electricity sent to the US and Trump is looking to roll back the 50% tariff on aluminum/steel; earlier in the day, Trump said the 25% tariff on base metals would double for Canada. The market reacted positively to the headlines led by Tech and high beta plays, including recent underperforms such as those tied to the AI theme. Separately, US/Ukraine reached a mineral rights deal and Ukraine is said to accept a 30-day truce; Trump is supposed to speak to Putin this week, potentially as early as today.From a macro data perspective, JOLTS points to improved labor market conditions while the Small Business Survey pointed to worsening sentiment and weaker expected, future behavior such as hiring and capex spending. The Small Business Hiring index fell xx points MoM and this has been a leading indicator for NFP.

* Technicians are now sullen and morose...

* I Buy...

“Not losing big is the single most important factor for winning big. As a speculator, losing is not a choice, but how much you lose is.”

- Mark Minervini

Bonus - here are some great links:

A Key Level Has Been Broken A key level has been broken 📉

March Madness March Madness - Carson Group

Things You Don't See In A Bull Market Things You Don’t See in a Bull Market

Fourth Worst Post Inaugural Performance since WWII Almanac Trader — 4th Worst Post Inaugural S&P 500 Performance since...

Equity Market Grapple With Tariffs Equity Markets Grapple with Tariffs

In support of my contrarian long purchases over the last 24 hours, the S&P Short Range Oscillator has moved further into oversold.

It is now at -5.97% vs. -4.92%.

Unspontaneous Combustion

From the teeth of yesterday's decline:

Long Time This Long

I am at the largest net long position since Q3 2023.

By Doug Kass Mar 11, 2025 2:40 PM EDT

Wolf Street howls about the conclusive breakdown in the brick-and-mortar retail industry.