The prices of several notable marijuana stocks bumped higher on Monday following an update on U.S. legalization from Canadian bank CIBC (NYSE:CM). Formerly skeptical about the prospects for legalization at the federal level, CIBC's team of analysts now believe this could occur as soon as next year if Joe Biden is elected president and Democrats win control of Congress.
That provided a nice high for investors in traditional marijuana plays Curaleaf Holdings (OTC:CURL.F), Green Thumb Industries (OTC:GTBI.F), and cannabidiol (CBD) specialist Charlotte's Web Holdings (OTC:CWBH.F). At their peaks on Monday, the three stocks were up a respective 9%, 5%, and 5.6%.
Cannabis stock investors have been starved for good news about the sector for quite some time, given the many struggles their companies face and their habit of posting bottom-line losses.
At present, there's almost no chance that legalization will occur on the federal level with the Republicans in control of the Senate. Many prominent GOP senators have indicated in no uncertain terms that they are vehemently opposed to such an idea.
At present, 33 U.S. states have legalized either medical or recreational cannabis consumption and sale to some degree. On top of that, the economic damage wrought by the coronavirus outbreak is going to drain both federal and state coffers, so any revenue-producing idea will likely be considered. If the Democrats sweep this November, federal legalization looms as a very real possibility.