Pot stocks soar on report DEA will ease restrictions on cannabis

• Cannabis stocks soared on Tuesday after the AP reported that the DEA will soon reclassify marijuana.
• The move would ease restrictions on cannabis and acknowledge that it has medicinal benefits.
• According to the report, the DEA decision would be sent to the White House Office of Management and Budget for review.

Cannabis stocks soared on Tuesday after the AP reported that the US Drug Enforcement Administration is on the verge of reclassifying marijuana.

Shares of Canopy Growth soared 37%, Village Farms stock soared 20%, and the AdvisorShares Pure Cannabis ETF jumped 18%.

The move would reclassify cannabis as a Schedule III drug alongside other drugs like ketamine and some anabolic steroids and acknowledge that the drug has medical benefits. That's compared to its current classification as a Schedule I drug, which is a list reserved for the most harmful drugs like heroin and LSD.

The reclassification of cannabis would help clear the path for easier regulations and open up a potential pathway in the future for federal legalization of the drug. Cannabis is already legal for recreational use in 24 states, and is legal for medical use in 38 states.

According to the AP, the DEA's upcoming decision will be sent to the White House Office of Management and Budget for review, and once they sign off, the change will be subject to a public comment period and a review by an administrative judge.