Marijuana News Today
The marijuana news today gives us an interesting—perhaps worrying—glimpse into the state-by-state fights that form the war over U.S. marijuana legalization.
This time, we’re looking at New Jersey. The state has legalized medical marijuana and is looking to expand this to recreational marijuana.
The push began in earnest when Democratic Governor Phil Murphy took office in January.
The state has seen more than 10,000 patients enroll in its medical marijuana scheme, bringing the total number in the state to 25,000. More medical dispensaries are also on the way. (Source: “In New Jersey, Legal Marijuana Is So Close You Can Smell It. But It Could Be Awhile.,” The New York Times, July 16, 2018.)
But the fight for recreational marijuana to become legal in New Jersey has only just begun. It’s a microcosm of the grander battle being waged over U.S. marijuana legalization on the national stage.
First, you have legislators trying to work their way around the issue.
While Democrats have increasingly become more supportive of recreational marijuana legalization, New Jersey is demonstrating why that support isn’t universal or guaranteed.
Urban lawmakers, for instance, fear that there will be a proliferation of dispensaries in their districts if the drug is legalized—a scenario that many of their constituents would rail against.
Then you have the army of lobbyists and other moneyed interests getting involved, like the New Jersey Liquor Store Alliance and the New Jersey Manufacturers Insurance Company, all with their own takes on legalization and specific desires surrounding pot.
It’s a muddy issue, with many interested parties pushing for what they believe will benefit them. But it’s not all doom and gloom in the fight for New Jersey marijuana legalization.
The state is being innovative in its plan to roll out legalized pot by proposing a bill that would grant existing medical dispensaries a license to sell recreational marijuana the first day it becomes legal. That would greatly accelerate the legalization process.
In other states, legalization often takes months or even years to implement. Canada is a perfect example, wherein Prime Minister Justin Trudeau ran for election in 2015 with a promise to legalize pot. In that country, the legalization date has finally been set for October 17, 2018.
As more U.S. states push for legalization, the closer we’ll be to passing a threshold that the federal government simply won’t be able to ignore.
As it stands, New Jersey recreational marijuana legalization is still a work in progress. But the overall mood across the nation is one of optimism when it comes to marijuana reform. And that’s great news for pot stocks.
Canopy Growth Stock News
While politically we may be heading in the right direction when it comes to legalization, the marijuana news today is dismal when it comes to stocks.
Many share prices in the pot stock market are down, with Canopy Growth Corp (NYSE:CGC) falling by over two percent in early-morning trading.
Chart courtesy of StockCharts.com
What we’re witnessing now is a response to the massive spike in value that came as a result of the Canadian marijuana legalization date being announced.
The hype generated from that announcement pushed many marijuana stocks up double-digits in just a few days. But investors have since woken up with a pot hangover; many of them have been filtering out of the market over the past few weeks.
This is not a permanent problem, but it’s one that will likely stalk the pot stock market for the next few weeks.
CGC stock has been tanking since July 12, and is down almost double-digits over the past six days.
While earlier weeks were milder after the up-and-down of the marijuana legalization date announcement, we’re still seeing a steady decline among many pot stocks.
The key is to avoid panic selling. The marijuana stock values will recover in the near future, but the next few weeks could be bumpy for CGC stock.
The weakness in the marijuana stock market is spreading even to its best performers, like MedReleaf Corp (OTCMKTS:MEDFF, TSE:LEAF).
Still flying high off the news that Aurora Cannabis Inc (OTCMKTS:ACBFF, TSE:ACB) would be buying the company, MedReleaf stock has been one of the darlings of the industry in the past few months.
But with a pullback extending across the entire marijuana sector, MEDFF stock was down by about two percent in early-morning trading today—and down by almost double-digits over the past six days.
In fact, MEDFF stock closely mirrors CGC stock.
MedReleaf is, of course, one of the more exciting stocks in the market because of the acquisition deal. As such, the timeline on a MedReleaf stock play is shortened.
It’s a riskier play because the industry is weak right now but the hype around MedReleaf is strong, creating a dynamic that makes the stock’s future less predictable.
For risk-prone investors, MedReleaf stock is very enticing. Risk-averse buyers, however, should probably look elsewhere in this climate.
The marijuana news today once again demonstrates just what a complicated issue legalization is in the United States.
Meanwhile, the marijuana stock market is shaky these days, and that has investors on edge.
But the troubles in both areas are temporary. Marijuana legalization in the U.S. will continue to spread, and pot stock prices will recover.
But, as always, the key here is timing. In the pot stock market, I expect a prolonged pullback for at least a few weeks. That makes buying marijuana stocks right now a risky proposition.