Shares of cannabis companies jumped after a report said President Trump plans to push for marijuana to be reclassified as a less dangerous drug.
SHARES of cannabis companies jumped on Friday after the Washington Post reported U.S. President Donald Trump is expected to push the government to dramatically loosen federal restrictions on marijuana.
U.S.-listed shares of Tilray Brands gained 28%, while SNDL, Canopy Growth and ETF AdvisorShares Pure US Cannabis were up between 13.5% and 32.5% in premarket trading.
According to the report from Thursday, Trump plans to direct agencies to reclassify marijuana as a Schedule III drug, reducing oversight of the plant and its derivatives to the same level as some common prescription painkillers and other drugs.
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“We believe this would open the door for pharmaceutical companies to seek approval for more cannabis products, which could then be dispensed the same as other prescription drugs,” TD Cowen analyst Jaret Seiberg said in a note.
Trump’s administration has been looking to reclassify marijuana as a less dangerous drug, a shift that could ease criminal penalties and reshape the industry through potentially lower taxes and by making it easier to secure funding.
Funding remains one of the biggest challenges for cannabis producers, as federal restrictions keep most banks and institutional investors out of the sector, forcing pot producers to turn to costly loans or alternative lenders. – Reuters
