Marijuana Stocks Soar As California Legalizes Recreational Pot
Companies in the cannabis industry have added nearly $2 billion in value since California dispensaries started to legally sell recreational marijuana on Jan. 1.
Heartened by the reportedly long lines outside Californian dispensaries and a possible wave of legalization in other states, shares in cannabis-related firms soared Tuesday. Canada-based Canopy Growth rose 9%, Vancouver-based Aurora jumped 24%, U.K.-based GW Pharma popped 2%, Ontario-based Aphria grew 8%, Canadian firm MedReleaf climbed 27%, Toronto-based Cronos Group advanced 5%, and while another Canadian company Canntrust increased 5%.
Still the companies are relatively small, with some trading—in the U.S., at least—on less regulated over-the-counter markets that come with extra risk. The seven companies, the largest marijuana-related firms by market capitalization, according to Marijuana International Corporation, added about $1.7 billion in value in the past day, for a total of over $19 billion.
That came as California made selling pot for recreational purposes legal for people 21 or older, and allowing them to possess up to one ounce of the drug.
The surge also comes as Canada is set to become the second nation after Uruguay to legalize recreational marijuana by July. Massachusetts meanwhile is also expected to begin selling marijuana for recreational purposes in July.
Despite California’s legalization, marijuana sales remain illegal under federal law.