Cannabis stocks rebounded on Thursday after initial election disappointment on Wednesday.
Votes are still being counted, but marijuana investors don’t seem likely to get the “blue wave” Democratic sweep they had hoped for. However, state cannabis measures passed in five different states, and Joe Biden appears to be on the brink of securing the White House, opening the door for potential federal cannabis reform measures down the road.
Bullish Election Results: On Wednesday, executives from Curaleaf Holdings Inc CURLF and Green Thumb Industries Inc GTBIF told Cantor Fitzgerald that the election results could ramp up pressure for federal U.S. cannabis reforms.
“Both speakers believe that under a Biden WH and Republican-controlled Senate, banking reform would pass in early 2021 and would be included in a COVID relief package (Sen. Toomey from PA will chair the Senate Banking Committee, and this is seen as a positive change vs. Sen. Crapo from Idaho),” Cantor analyst Pablo Zuanic wrote in a note.
In the longer-term, Zuanic said industry insiders are hopeful some form of legislation making cannabis federally permissible could pass following the 2022 midterm elections.
Stocks On The Move: After an initial blue wave disappointment sell-off on Wednesday, here’s how some major cannabis stocks and funds were trading on Thursday:
- Aurora Cannabis Inc ACB was up 18.4%.
- Canopy Growth Corp CGC was up 5.8%.
- Cronos Group Inc CRON was up 7.3%.
- Tilray Inc TLRY was up 20%.
- ETFMG Alternative Harvest ETF MJ was up 5.8%.
- Amplify Seymour Cannabis ETF CNBS was up 5.4%.
- AdvisorShares Pure Cannabis ETF YOLO was up 4.3%.
Benzinga’s Take: Following the latest round of state recreational legalizations in New Jersey, South Dakota, Montana and Arizona, about 31% of the U.S. population will now live in states with legal access to recreational cannabis. But on a federal level, cannabis investors must now wait out the official results of the U.S. presidential and Senate races to eliminate the possibility of any last-minute surprises in the vote counts.
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