Cannabis stocks soar after report says Congress plans vote on federal legalization of the drug next week

• Cannabis stocks soared on Thursday after a report said Congress has scheduled a vote to legalize the drug.
• The U.S. House of Representatives will reportedly vote next week on the Marijuana Opportunity, Reinvestment and Expungement Act.
• If enacted, the bill would remove cannabis from the list of federally controlled substances.

Cannabis stocks surged in late-afternoon trades on Thursday after Congress scheduled a vote to federally legalize the drug, according to a report from Marijuana Moment.

The U.S. House of Representatives will vote next week on the Marijuana Opportunity, Reinvestment and Expungement act, a bill that would remove cannabis from the list of federally controlled substances. If passed, the bill would be sent the the Senate for approval before heading to President Joe Biden's desk for his signature.

Shares of Tilray and Sundial soared nearly 20%, while Canopy Growth was up about 10%. The ETFMG Alternative Harvest ETF was up more than 6% in Thursday trades.

The legalization of marijuana is an issue that has garnered bipartisan support, and while chances are good that a bill would pass the House and the Senate, there is uncertainty as to whether President Biden will be in favor of signing it.

Senate majority leader Chuck Schumer has been lobbying Biden about the importance of legalizing marijuana since he took office, and has expressed hope that he could change the Biden's mind.

According to Marijuana Moment, the Rules Committee will officially take up the measure in a Monday afternoon meeting to prepare it for floor action, which includes determining which amendments will be allowed to advance for consideration. The bill has already cleared the Judiciary Committee and was sponsored by Congressman Jerrold Nadler.

The last time the MORE act was voted on in the House was in December 2020, when it passed in a 228 to 164 mote with five Republicans voting in favor of it. Whether the bill makes it to the Senate and is ultimately signed into law by President Biden, it's clear based on state-by-state rollouts of laws legalizing the drug that commercialization efforts will take time to get setup in a legal retail environment.

Marijuana is legalized for recreational use in 18 states, and is legalized for medical use in 38 states. Recreational legalization of the drug at the federal level would more than double the geographical target market for marijuana growers, refiners, and distributors.