Stocks Rise After Trump Backs CBD
Trump endorsed CBD for senior healthcare
On Monday, September 29, shares of cannabis companies jumped after U.S. President Donald Trump endorsed Cannabidiol for senior healthcare. This is a non-psychoactive compound from cannabis that has many medical uses. Trump's support followed his earlier comment about reviewing the classification of cannabis under the Controlled Substances Act.
Trump stated that CBD could “change senior healthcare” by helping to manage diseases and serving as an alternative to prescription medications. He made this announcement in a post on Truth Social on Sunday, September 28. The next day, cannabis shares rose significantly, even before the market opened.
How Much Have US Cannabis Stocks Grown?
Shares of Canopy Growth and Cronos Group increased by at least 15% during the day. Tilray Brands saw a 42% increase, while Aurora Cannabis rose by 25.4%. AdvisorShares ETFs gained almost 22%, and Roundhill went up by 21.6%, marking their biggest quarterly gains, according to reports.
A representative from Canopy Growth, a Canadian company, said, “We are hopeful about the U.S. government recognizing cannabis and its potential to support health and wellness for seniors.”
It’s expected that cannabis stocks will rise when a prominent figure like the U.S. president supports cannabis. Daniela Hathorn, a senior market analyst at Capital.com, said, “I think these stocks could rise further if reclassification happens.”
Public Support Follows Trump's Comments on Cannabis Reclassification
Reclassifying cannabis is not the same as legalizing it, but it would help align state and federal regulations. Trump mentioned reclassifying cannabis a month ago, stating that his administration would look into it.
Changing the Controlled Substances Act would reshape how cannabis is regulated. This change would remove many federal barriers for cannabis businesses, allowing more companies to go public and enter the stock market. The rules for the use of hemp and CBD became much easier after Trump signed the Agriculture Improvement Act in his first term.
Later, President Joe Biden began a process to remove cannabis from the Schedule I list under the Controlled Substances Act and make it a Schedule III drug. This change would classify cannabis among safer drugs than it is now.
Over time, cannabis stocks have responded to each U.S. administration's actions on cannabis policy. Delays in decisions have created market volatility for investors and businesses. Many hope this volatility will decrease with the expected reforms in cannabis policy.
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