Cannabis Stocks Skyrocket As Federal Bill To Decriminalize Marijuana Shows Promise
The House Rules Committee is holding a hearing on the ”Marijuana Opportunity Act” (MORE Act) on March 30th, a bill which would decriminalize marijuana. News of a potential federal legalization triggered a renewed investor optimism, and a slew of cannabis stocks have been soaring.
CNBC reported that a vote is expected by Friday, Apr 1.
MarketWatch reported that Canopy Growth Corp., a Canadian company, is poised to immediately benefit from U.S. legalization, as it has an option to acquire multi-state operator Acreage Holdings once the law changes. The stock was up 5.3% on March 30th. Other weed stocks which are surging include Tilray Brands — up 6.5% on March 30th — and Aurora Cannabis — up 8.5%.
Marijuana exchange traded funds (ETFs) are also set be big winners, and the recent optimism has boosted some of them. The Alternative Harvest ETF for example, has gained more than 10% in March, and is on pace for its best month since February 2021, CNBC reported. The Cannabis ETF was up 1.6% on March 30th, while AdvisorShares Pure US Cannabis ETF was up 0.5%.
The bill noted that 37 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands have adopted laws allowing legal access to cannabis. Also, 15 states, the District of Columbia, the Commonwealth of the Northern Mariana Islands and Guam have adopted laws legalizing cannabis for adult recreational use. In addition, legal cannabis sales totaled $20 billion in 2020 and are projected to reach $40.5 billion by 2025.
House Majority Leader Steny Hoyer said in a letter that this is “a critical legislation that will restore justice to communities that have been disproportionately impacted by harsh penalties for possessing even small amounts of marijuana. Sponsored by Chairman Nadler of the Judiciary Committee, along with the leadership of Reps. Earl Blumenauer and Barbara Lee, this legislation — which the House passed last Congress — would decriminalize marijuana, expunge the federal arrests and convictions of nonviolent marijuana offenders, prohibit the denial of federal public benefits, and provide resources to support long-term economic recovery efforts for communities of color.”
More From GOBankingRates