Marijuana News Today: Trudeau Promises Canadian Marijuana Legalization on Track
Marijuana News Today
Despite pressure coming from a number of political forces within Canada, the marijuana news for today sees Prime Minister Justin Trudeau holding fast to his promise of Canadian marijuana legalization this summer.
“We’re going to continue to move forward,” said Trudeau. “We’re going to bring in legalization as we’ve committed to this summer on schedule.” (Source: “Plan to make marijuana legal by summer on track, Trudeau says, despite calls to delay it,” National Post, May 3, 2018.)
The Canadian Senate has been the main opponent of the summer timeline. Comments coming from that body of government recommended slowing down the process in order to increase consultation with First Nations on taxation, education materials, and addiction treatments.
Any sort of delay, however, would wreak havoc on marijuana stocks. The marijuana news today, therefore, is positive in that Trudeau stuck to his guns and reassured investors that, indeed, the Canadian marijuana legalization process is underway and on track.
With the weed downturn in 2018 still largely in effect, Canadian marijuana legalization is precisely the type of event that I believe will help kick-start companies’ gains.
I’ve long held that this summer will be a strong season for marijuana stocks. That could all change, should the legalization plan in Canada experience a delay, however.
“Right now young people have far too easy access in Canada to marijuana,” said Trudeau. “Criminal organizations make billions of dollars a year in profits on the sale of marijuana.”
He added, “We need to move forward on a system that controls and regulates while protecting our kids and our communities.” (Source: Ibid.)
But even with Trudeau’s support, a great many questions still hang in the air over just how Canadian marijuana legalization will look. It is precisely those questions that are leading critics to claim that it’s all happening too fast, with too little attention being paid to the consequences.
For instance, Bill C-45 would make it legal for Canadians to grow up to four cannabis plants at home, but provinces and territories all are free to institute their own regulations. Manitoba and Quebec have already said they will not permit home cultivation of any kind. The Senate released a report this week that echoed those beliefs.
Other questions still surround just how Canadian legalized marijuana will look, with issues such as how the drug will be marketed still being publicly and vociferously debated.
The main question is how the drug will be marketed in such a way as to specifically avoid being angled toward young people. (Source: “Marketing marijuana after it is legalized,” Global News, May 4, 2018.)
The multifaceted debate currently ongoing in Canada is one that pot stock investors will want to keep their eyes on.
If Trudeau remains steadfast in his support of his current timeline, we can expect to see strong gains across the board in the marijuana industry when we enter the summer.
Should Canadian marijuana legalization suffer another setback, however, 2018 may turn out to be a very tough year for pot stocks (barring any sort of other groundbreaking developments like a push for legalization in the U.S. or Germany).
In any case, for now, it seems that Trudeau and his government will not be deterred. Hopefully, that holds.
Marijuana Stocks in May
While the long-term projection of marijuana stocks was at risk in the marijuana news today, Trudeau’s support for the legalization timeline—and the opposition coming out against it—did little to sway stock prices.
So far this month, we’ve seen relatively little movement among the heavy hitters.
While Cronos Group Inc (NASDAQ:CRON) is still fighting back after a pretty devastating end to April where it fell nearly 15%, Aurora Cannabis Inc (OTCMKTS:ACBFF, TSE:ACB) and Canopy Growth Corp (OTCMKTS:TWJMF, TSE:WEED) are holding steady, with fairly moderate gains over the past few days.
Chart courtesy of StockCharts.com
Cronos Group stock is still down, although the past few days have seen its fortunes change slightly. The company was able to climb two percent and make its way back toward the black.
Aurora Cannabis stock, meanwhile, has seen a slight bit of movement in stock value so far in May. The company has climbed about two percent since the beginning of the month.
Canopy Growth stock has followed largely the same trajectory, showing gains of about two percent this month.
Should these gains sustain and grow as the month goes on, that would be a very positive sign, and potentially an indication that we are out of the marijuana correction that has plagued the industry for months now.
Analyst Take
Trudeau’s unwillingness to budge on his timeline for Canadian marijuana legalization is a huge win for the marijuana sector.
While the effects aren’t being felt on the market right now, in the long term, this is a must-have for pot stock investors who are looking to achieve big gains in 2018.
If the date for legalization is pushed back, I believe it would be calamitous for marijuana stocks across the industry—at least in the near term.
Aside from the political happenings, the recent marijuana news had little to offer from the stock market side of things. May has started out quiet, but that may be exactly what we need to see from the market after a volatile few months in 2018.
