Quad witching, Nike slides, weed rules and more in Morning Squawk

As investors prepare for a potentially tumultuous trading session, Wall Street is gearing up for a rare 'quadruple witching' day, where options on four different types of securities will expire. This event, which occurs only four times a year, is expected to bring significant volatility to the market. In premarket trading, shares of Nike took a notable downturn following the company’s announcement of anticipated revenue declines for the upcoming quarter. With ongoing challenges in the Chinese market, Nike forecasts a low single-digit revenue drop for the fiscal third quarter. While North America showed modest growth, the company also warned of a shrink in gross margins, primarily due to tariffs. However, not all news was negative; strong sales in North America helped mitigate the impact from China, and the results exceeded Wall Street's projections. Nike's CEO, Elliott Hill, described the situation as the “middle inning of our comeback.” In a significant shift for U.S. cannabis policy, President Donald Trump signed an executive order that will direct federal agencies to reclassify marijuana, potentially easing long-standing restrictions. This landmark decision could move cannabis from the Schedule I category—which includes drugs like heroin—to Schedule III, which encompasses substances recognized for medical use and deemed to have a lower risk of abuse. Following the announcement, shares in cannabis companies experienced a decline as investors expressed concerns about increased competition. In another development, U.S. Department of Homeland Security Secretary Kristi Noem announced the suspension of the diversity visa program, citing that the suspect involved in a recent tragedy at Brown University had been granted a visa through this program. As for the M&A landscape, Wall Street had anticipated a surge in deal-making following President Trump's re-election. However, the reality has been a series of fits and starts, with around 13,900 transactions reported this year compared to 15,940 in the same timeframe last year. Executives had hoped for a more favorable regulatory environment, but instead faced challenges such as tariff uncertainties and high interest rates. Notable deals this year included Union Pacific's proposed acquisition of Norfolk Southern and Netflix's bid for Warner Bros. Discovery's assets. In college sports, the University of Texas at Austin has emerged as the top athletic program, now valued at $1.48 billion, marking a 16% increase from the previous year. With a revenue of $332 million for fiscal 2024, they surpassed all competitors, including Ohio State University, which fell to second place. As the trading day unfolds, investors will be paying close attention to these developments, which could shape the market's direction in the coming weeks.