Yahoo

    Pot firms reverse gains on narrow scope of US rescheduling

    Reuters Videos
    Explore stocks on Coinbase

    <span>STORY: Shares of cannabis firms reversed early gains on Thursday as investors took a closer look at the limited scope of the U.S. government's move to reclassify marijuana as a less-dangerous drug.</span><span>Cronos Group, Aurora Cannabis, Canopy Growth and Tilray Brands slumped between 7% and 15% in afternoon trading.</span><span>Shares of these companies had surged after Acting Attorney General Todd Blanche in a social media post said the Department of Justice was, quote, "immediately rescheduling FDA-approved marijuana and state-licensed marijuana from Schedule I to Schedule III." The department is also initiating an expedited hearing to consider the broader rescheduling of marijuana.</span><span>But industry insiders said the move stops short of a sweeping reclassification.</span><span>The CEO of FundCanna, which provides capital for cannabis companies, said the order applies specifically to FDA-approved cannabis drugs and products operating under state medical marijuana frameworks, rather than the broader market, creating uneven benefits across the sector.</span><span>A top executive at CB1 Capital Management added that the move was narrower than investors had hoped, rescheduling medical cannabis immediately while setting a June hearing on adult use...</span><span>with the market not understanding the, quote, "nuances involved, the opposition or the legal challenges." </span><span>Still, overall, the sector applauded the decision.</span><span>It would lift a major tax burden that is unique to the cannabis industry that had prevented some companies from claiming tax credits and writing off basic business expenses.</span><span>The reclassification could also ease access to funding as federal restrictions have long kept most banks and institutional investors on the sidelines, forcing cannabis producers to rely on costly loans or alternative lenders.</span>

    Terms and Privacy Policy
    Your Privacy Choices
    More Info

    Recommended Stories

    Mobilize your Website
    View Site in Mobile | Classic
    Share by: