Marijuana producer Canopy stock surges 7% after saying it will enter U.S. hemp market

Canopy Growth Corp. CGC, -1.78%WEED, -1.38% said the company planned to enter the U.S. hemp sector following the passage of the farm bill Thursday that legalized industrial hemp. Canopy stock is up 7.8% after hours. "Canopy Growth will participate in the American market now that there is a clear federally-permissible path to the market," Chief Executive Bruce Linton said in a statement. Canopy said its investment in intellectual property from U.S.-based Ebbu Inc. and the $4 billion investment from Constellation Brands Inc. STZ, -3.03% positioned it well to enter the U.S. hemp market. Like much of the cannabis sector, Canopy closed down, dropping 1.8% during regular trading. ETFMG Alternative Harvest ETF closed down 2.2% Thursday and the S&P 500 index SPX, -1.58% fell 1.6%.

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