By Dean Seal
U.S. cannabis stocks got a lift on Friday morning after President Joe Biden suggested during his State of the Union speech that restrictions on marijuana should be loosened.
AdvisorShares Pure US Cannabis, a popular exchange-traded fund tracking marijuana stocks, was up 4.3% at $8.07 in early trading. The ETF has gained 15% since the start of the year.
Shares of Curaleaf, the biggest U.S. cannabis company by revenue, were up 5.1% at $4.41. Tilray Brands’ stock rose 5.8% at $1.74.
Shares of Green Thumb Industries, Verano Holdings and Trulieve Cannabis, three major operators in the U.S., advanced around 2% to 3%. Canadian cannabis stocks gained as well.
The president said on Thursday night that he is directing regulators to review whether cannabis should be reclassified and that “it doesn’t make sense” that the federal government controls cannabis more tightly than drugs like cocaine or fentanyl.
Last August, the Department of Health and Human Services recommended removing cannabis from the most restrictive category of drugs. The Drug Enforcement Administration is currently reviewing whether cannabis’ classification as a Schedule 1 drug should be changed.
Some industry analysts expect the DEA to accept the Health and Human Services Department’s recommendation and reschedule cannabis sometime this year. Doing so could upend a tax regime that currently prevents state-licensed cannabis companies from taking the same federal tax deductions on business expenses.
The cannabis stock gains also come after Senate Majority Leader Chuck Schumer told cannabis news outlet Marijuana Moment that the SAFER Act was a “very high priority” and that an agreement that can pass both chambers of Congress was in the works. The SAFER bill that would let marijuana businesses work with traditional banking institutions and access financial services available to most other industries.
Write to Dean Seal at dean.seal@wsj.com
(END) Dow Jones Newswires
March 08, 2024 11:16 ET (16:16 GMT)
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