Thursday morning brought more gains to Wall Street, as stock market benchmarks continued to gain ground. Investors are more excited than ever about the prospects for economic stimulus from the federal government to keep adding to the market's momentum. Just before noon EST, the Dow Jones Industrial Average (^DJI -3.57%) was up 336 points to 32,633, breaking further into all-time record high ground. The S&P 500 (^GSPC -4.04%) was up 54 points to 3,952, on pace for a similar record, and the Nasdaq Composite (^IXIC 0.00%) had pushed higher by 328 points to 13,397.
Investors have paid a lot of attention both to the marijuana stock arena as well as to potential comeback stocks following the COVID-19 pandemic. Today, that trend is playing out well, as both OrganiGram Holdings (OGI -9.02%) and AMC Entertainment Holdings (AMC -1.08%) are pushing higher to lead the market upward.
OrganiGram gets interest from big tobacco
Shares of OrganiGram Holdings were up 27% on Thursday morning. The Canadian cannabis producer became the latest company to make a deal with a large tobacco producer, and investors are excited about what it could mean for the marijuana industry's future.
OrganiGram announced a product development collaboration with U.K. tobacco giant British American Tobacco (BTI -2.20%). Under the terms of the deal, British American will invest 221 million Canadian dollars in order to receive an equity stake of just less than 20% of OrganiGram. The two parties will also work together to establish what they're calling a "center of excellence" to develop and promote next-generation cannabis products.
The move is the latest in a series of consolidation and merger and acquisition efforts in the cannabis industry. The pending merger of Tilray (TLRY) and Aphria (APHA) will create a huge player in cannabis worldwide, while British American rival Altria (MO -1.92%) already has a relationship with Cronos Group (CRON -6.21%) that includes a roughly 45% equity stake.
Investors are excited to see British American finally make a move in marijuana. The investment isn't a huge one, but it could signal a strategic shift as part of a larger effort to move away from cigarettes and other traditional tobacco products.
AMC's rolling the film
Elsewhere, shares of AMC Entertainment Holdings picked up almost 5%. The movie theater operator announced huge drops in financial performance for the fourth quarter of 2020, but investors are already looking ahead to the potential for reopening and a return to more normal conditions.
AMC's revenue for the quarter plunged 89%, resulting in a net loss of $946 million. That brought AMC's total losses for the year to nearly $4.59 billion. Attendance during the quarter fell more than 90% to under 8.1 million overall and just 4.8 million in the U.S. market.
However, AMC did reassure investors that it has ample access to capital. The theater operator has $308 million in available cash and has restructured various debt to make it easier to maintain.
Cost-cutting measures are also paying off. Furloughs and other measures kept expenses down when theaters were closed, and limits on optional spending for travel, marketing, and promotion have worked well.
Now, the question is when theater-goers will go back to the movies. As of early march, AMC was operating nearly 90% of its U.S. locations, but seating capacities remain limited in many jurisdictions. Investors are optimistic that AMC can recover, but there's still a long road ahead for the ailing theater operator.