Business World

Monday 23 July 2018

Marijuana stock boost after Trump backs state regulation

 

'Marijuana stocks surged on the news, which removed the threat posed by Sessions's decision in January to rescind an Obama-era policy that helped states legalise recreational pot.' (stock photo)
'Marijuana stocks surged on the news, which removed the threat posed by Sessions's decision in January to rescind an Obama-era policy that helped states legalise recreational pot.' (stock photo)

Steven T Dennis

US President Donald Trump has endorsed letting states decide how to regulate marijuana, in a major boost for the legal pot industry.

Colorado Republican Senator Cory Gardner said that as a result of Trump's assurances, he'll end a blockade of the administration's Justice Department nominees.

Gardner held up the nominees after attorney general Jeff Sessions rescinded an earlier Justice Department memo that shielded marijuana operations in states like Colorado from enforcement of the federal ban on the drug.

"Since the campaign, President Trump has consistently supported states' rights to decide for themselves how best to approach marijuana," Gardner said in a statement on Friday.

"President Trump has assured me that he will support a federalism-based legislative solution to fix this states' rights issue once and for all," the senator added.

White House Press Secretary Sarah Huckabee Sanders said Gardner's statement was "accurate".

"The president did speak with Senator Gardner yesterday and again today," Sanders told reporters on Friday at the White House, adding, "the president is a firm believer" in states' rights.

Marijuana is legal for medicinal use in 29 states and for recreational use in eight.

Marijuana stocks surged on the news, which removed the threat posed by Sessions's decision in January to rescind an Obama-era policy that helped states legalise recreational pot.

Canada's Canopy Growth Corp, the largest cannabis producer by market value, jumped as much as 11pc in its biggest intraday advance since March 5.

Medical-marijuana supplier Aphria climbed as much as 21pc in Toronto trading.

Gardner said he's lifting his hold and working with colleagues on legislation that would protect marijuana operations in states that have legalised the drug.

The White House didn't immediately respond to a request for comment.

Trump offered qualified support for legalisation while on the presidential campaign trail, saying that medical marijuana "should happen" and that laws regarding recreational usage should be left in the hands of individual states.

Sessions, on the other hand, has been an outspoken opponent of state marijuana laws.

The US Justice Department under President Barack Obama created guardrails for federal prosecution of the sale and possession of cannabis, which remains illegal under federal law, and allowed legalised marijuana to flourish.

Under Sessions's approach, US attorneys in states where pot is legal were given approval to prosecute cases where they see fit.

Bloomberg

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