Pot stocks jump as U.S. DOJ moves to reclassify cannabis as a less dangerous drug

Green Thumb Industries

30/04/2024 20:06

April 30 (Reuters) - Shares of cannabis companies surged
on Tuesday afternoon after the U.S. Department of Justice (DoJ)
moved to reclassify marijuana as a less dangerous drug.
    U.S.-listed shares of Cronos Group  CRON.O , Tilray Brands
 TLRY.O  and Canopy Growth  CGC.O  rose between 10.9% to 52%.
ETF AdvisorShares Pure US Cannabis soared 21%.
    Canada-listed Green Thumb Industries  GTII.CD  and Trulieve
Cannabis  TRUL.CD  were up 25% and 31% respectively. 
    The DoJ, which oversees the Drug Enforcement Administration,
recommended that cannabis be classified as a so-called schedule
three drug, with a moderate to low potential for physical and
psychological dependence, instead of schedule one, which is
reserved for drugs with a high potential for abuse, two sources
confirmed to Reuters.
    The proposal, which, if finalized, could potentially be the
most significant shift in federal cannabis policy in 40 years,
is being sent to the White House Office of Management and Budget
for review and to finalize the rule-making process, the sources
said.
    The reclassification will not legalize marijuana outright
for recreational use.
    Shares of U.S.-listed marijuana companies had similarly
soared in 2019 after Canada legalized recreational marijuana
use, but the rally collapsed the following year as underwhelming
revenue numbers failed to justify their sky-high valuations.

 (Reporting by Tanay Dhumal in Bengaluru; Editing by Tasim
Zahid)
 ((Tanay.Dhumal@thomsonreuters.com; Twitter: https://twitter.com/TanayDhumal;))