Alberta Cannabis Inc / Distribute via REUTERS
- Pot stocks jumped on Wednesday as Democratic victories in Georgia’s run-off elections boosted hopes of short-term investor decriminalization.
- Democrats Raphael Warnock and Jon Ossoff won their races and gave the party control of the Senate, according to projections from Headquarters of the Decision Bank and Insider.
- The slim control of the Senate increases the chances of the marijuana being decriminalized at the federal level.
- Tilray rose as much as 19.1%. Aurora Cannabis and Canopy Growth climbed 16.5% and 17.7% to intraday highs.
- Visit Business Insider’s homepage for more stories.
Pot stocks rose Wednesday as the results of the Senate by-elections in Georgia lifted hopes of investors on nationwide decriminalization.
Raphael Warnock and Jon Ossoff won their races, according to predictions from Decision Desk HQ and Insider, which gave the Democrats a slim majority in the Senate for the first time since 2011.
The Democratic-controlled House passed a bill in December to decriminalize and tax marijuana at the federal level, but Senate Republicans deterred the measure. The victory of the Democrats in Georgia gives the party a slim margin to pass more progressive legislation on cannabis, although Republicans will still be able to vote for such votes.
Investors have piled up cannabis stocks according to the newly bullish outlook. Tilray rose as much as 19.1%. Aurora Cannabis and Canopy Growth climbed 16.5% and 17.7% to intraday highs.
Read more: Ten top experts on Wall Street unveil their forecasts for the stock market for 2021 – and tell you where to put your money
Pot stocks rose after the election in November to the end of 2020, and also strengthened hopes for short-term criminalization. Aurora Cannabis nearly doubled on November 6, as the prediction that Joe Biden would win lifted the sector. Democrats have previously promised to enact decriminalization legislation should Biden join.
The legalization of marijuana for recreational use in Montana, New Jersey, South Dakota and Arizona also increased cannabis supplies in November.
Nationwide decriminalization of cannabis will rapidly expand the accountable market for producers. Companies have so far been relocated to countries where the drug is legal. Only 15 states fully legalized marijuana, while another 16 decriminalized the drug for non-medical use.
Now read more market coverage from Markets Insider and Business Insider:
Buy these 30 stocks that can beat the market in 2020 and are ready for the best global returns in 2021, says RBC
Billionaire investor Bill Gross says the ‘Teslas of 2020’ could struggle in 2021 and reveals his best choice for the new year
‘The most important event of your investment life’: Jeremy Grantham reiterates his warning that the stock market is in an epic bubble