Marijuana stocks aren't an asset class that's been known for price pops lately. Yet on Tuesday, many weed titles did well by investors, even those companies based in the beleaguered Canadian market.
Aurora Cannabis (ACB -0.36%), Tilray (TLRY 1.09%), and OrganiGram Holdings (OGI -4.29%) enjoyed 6%-plus gains on the day. Meanwhile, fellow Canadian companies Canopy Growth (CGC 3.57%) and Sundial Growers (SNDL -0.69%) posted rises of almost 4% and nearly 2%, respectively. Not to be outdone, U.S. cannabidiol (CBD) products specialist Charlotte's Web Holdings (CWBHF 5.00%) notched a 5% lift.
Of those half-dozen names, only one -- Charlotte's Web -- had any proprietary news of significance to report. The company announced Tuesday that it intends to produce and sell CBD-infused beverages, and is doing so "with new CBD social elixirs currently under development with an expected launch date later in the calendar year."
Since CBD drinks are hardly new to the market, this wasn't sufficient on its own to move Charlotte's Web stock, let alone marijuana titles. Rather, it seemed developments in U.S. legalization were the catalyst.
On Tuesday, the Virginia Senate passed a bill bringing forward the start of recreational cannabis sales in the state. If eventually signed into law, the recreational market would open for business on Sept. 15; the original law legalizing such products set 2024 as the start. The bill next goes to the state's House of Delegates for a vote.
Since marijuana is not yet legal (or decriminalized) at the U.S. federal level, Canadian companies cannot directly sell their product anywhere in this country.
But the latest development in Virginia indicates that American legalization continues to be a trend, albeit one developing in fits and starts. At some point, cannabis will likely be legal throughout the U.S., which will benefit all pot producers and distributors, whether American or not.