The potential shift in the political landscape has brought cannabis stocks into the spotlight. Zuanic & Associates, an equity research firm, recently reported that President Biden’s decision not to seek re-election has had a positive impact on the cannabis sector.
Analysts at the firm suggest that the prospect of Kamala Harris winning the Democratic nomination is seen as a positive development for cannabis stocks. They observed a 17% surge in the stock of Canopy Growth (NASDAQ:) and an average increase of 9% in other major licensed producers (LPs), with the MSOS ETF climbing by 5.7%.
Zuanic & Associates also pointed out that recent polls showing Harris’s stronger chances against Trump have reduced the risk of a “red wave” in November. This could potentially boost Democratic voter turnout and further benefit cannabis stocks.
Despite the optimistic outlook for cannabis reform under a Harris administration, the firm acknowledges that the path to federal rescheduling of cannabis remains complex. They caution that potential delays from the Department of Justice (DOJ) and the Drug Enforcement Administration (DEA) could pose obstacles to rescheduling.
The research firm believes that a Harris vs. Trump election would intensify the cannabis debate, potentially bringing reforms into focus but also increasing partisan risks. They suggest that a Trump victory could lead to uncertainty for cannabis stocks, as he is expected to maintain the status quo without rescheduling.
In conclusion, Zuanic & Associates asserts that a Harris victory in November would be more favorable for cannabis stocks compared to a Trump win, given Harris’s potential to advance rescheduling and other reforms.