A number of marijuana stocks are up right now after Germany’s cabinet approved a plan that would legalize some recreational cannabis use. Why are cannabis stocks up?
Well, Germany’s cabinet passed a controversial bill Wednesday that, if fully passed, would allow both the use and growth of marijuana. The bill, which still needs to pass German parliament, would make Germany one of the most liberal countries in Europe in terms of cannabis policy.
The bill allows adults to posses up to 25 grams of marijuana, as well as to grow a maximum of three plants. Adults would also be able to “acquire weed as associates of non-profit cannabis clubs.”
According to Chancellor Olaf Cholz, the bill is designed to protect Germans from contaminated or laced black market cannabis.
Meanwhile, Health Minister Karl Lauterbach highlighted the informative nature of the plan. Indeed, the law would promote an informative campaign designed to raise awareness of the risks of marijuana consumption and reduce the taboo culture surrounding the drug.
“With the current procedures we could not seriously protect children and young people, the topic has been made a taboo,” Lauterbach said in a news conference. “We have rising, problematic consumption, we couldn’t simply allow this to go on […] So this is an important turning point in our drug policy.”
Reasonably so, back in 2021, the number of German adults aged between 18 and 25 who had used cannabis at least once almost doubled from the previous decade to 25%.
Cannabis Stocks Up on New German Bill
As you may imagine, Germany’s new potential policy has lifted sentiments surrounding the industry potential of cannabis on the world stage.
Now, a number of major cannabis stocks are climbing as a result. This includes the likes of Canopy Growth (NASDAQ:CGC) and Aurora Cannabis (NASDAQ:ACB), which are currently up between 2% and 3% as of this writing. Curaleaf (OTCMKTS:CURLF) is up by about 2% today as well.
Cannabis stocks have enjoyed some strong recent gains in an otherwise underwhelming year. Indeed, according to the “Cannabis Stocks” watchlist on Yahoo Finance — which tracks many of the largest publicly traded marijuana stocks — pot stocks are up nearly 60% in the last month, although they are also about 10% in the red for the year. Meanwhile, the S&P 500 and Nasdaq Composite are up about 15% and 29% respectively, year-to-date (YTD).
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On the date of publication, Shrey Dua did not hold (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.
