Why are pot stocks up today? Cannabis stocks are up today after Senate majority leader Chuck Schumer said that Congress is getting “very close” to a marijuana bill.
The bill would open up banking access for legal businesses while expunging previous cannabis convictions. Schumer stated that there have been positive discussions in which progress has been made with a “bunch of Republican Senators.”
The ETFMG Alternative Harvest ETF (NYSEARCA:MJ) is up about 7% on the day. It’s being led higher by Canopy Growth (NASDAQ:CGC), which is up about 18% on the day. Canopy is the largest individual stock within the MJ ETF, for what it’s worth.
However, other pot stocks are moving nicely too.
Cronos (NASDAQ:CRON) is up 6%, SNDL (NASDAQ:SNDL) is up 8.5% and Tilray (NASDAQ:TLRY) is up 12%.
In a recent debate Schumer said:
“I am working in a bipartisan way with Democrats and Republicans to take the SAFE Banking Act, which allows financial institutions to involve themselves in cannabis companies and lend money to them—but it also does some things for justice, such as expunging a record.”
Another Reason Why Pot Stocks Are Up Today
Another step in the right direction from Washington and a huge positive for cannabis stocks.
Opening up banking and removing federal restrictions could make for simpler, less expensive operations for cannabis companies. At the same time, decriminalization may spur consumers to be more open toward cannabis use.
That said, another reason why pot stocks are up today is also simple: They have been crushed this year.
Canopy Growth and the MJ ETF are down 57% and 50% on the year, respectively. From the one-year high, they are down 75% and 64%, respectively.
Lastly, from the post-Covid highs, Canopy is down 92.8% and the MJ ETF is down 83%. So to say that it’s been a tough run is putting it lightly. Any positive news or developments — particularly on the Federal level — is enough to kickstart a big rally in this group.
If the good news continues, so too could the rally in pot stocks.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.