What happened
The latest buzz on the stock market is the suprising viability of marijuana companies. Last week, a top official at the federal Department of Health and Human Services (HHS) requested that the drug be reclassified, a move that led to a rally in nearly every notable pot title. The rally extended through Tuesday when it was revealed that the move apparently was instigated at the highest governmental level possible.
Cresco Labs (CRLBF 5.13%) is one of the numerous beneficiaries of this fresh buzz. On Tuesday, the multistate operator's (MSO) share price leaped 4.7% higher on the latest news.
So what
Late Monday, cannabis industry tracker Marijuana Moment reported on White House Press Secretary Karine Jean-Pierre's remarks about that reclassification request. In a press conference, Jean-Pierre said that none other than President Joe Biden was the person behind that move.
"So just so that everybody is clear: The President asked the secretary of HHS and also the attorney general to initiate the administrative process to review how marijuana is scheduled, as you just kind of laid out," she said in response to an attendee's question.
That is a highly encouraging piece of information. Although Biden campaigned on marijuana decriminalization, his administration has wavered on its support at various times since taking office at the start of 2021. After such an emphatic statement, it'll be hard for him or his officials to backtrack now.
Now what
Marijuana stocks are one of the most beaten-down groupings on the exchange, so this news is as welcome as a jug of water to dehydrated people in the desert. Optimism should be tempered a bit, though, as weed reform is still a controversial subject in some quarters, and the federal government tends to move slowly even when change is thick in the air.
Still, it's undeniably a good piece of news for weed advocates and the companies, like Cresco Labs, that cultivate, process, and sell the product.
