Weed Week: US cannabis companies wanna take it to the bank
Health & Biotech
Health & Biotech
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The past fortnight saw something of a bombshell announcement last Thursday, when the TGA found five Aussie companies — including two listed stocks — were issuing medical marijuana products which didn’t match was what on the labels.
Since then, key developments on local cannabis markets have been few and far between.
But as usual there was some activity abroad, as US lawmakers get set to vote on the next iteration of the HEROES Act (the COVID-19 relief bill).
The latest version of the bill also includes provisions of the Secure and Fair Enforcement (SAFE) Banking Act, which could mark a notable step in expanding the US cannabis market.
If passed, the SAFE Act would permit financial institutions to lend to cannabis companies that are operating legally within the state laws of their relevant jurisdictions.
Currently, financing rules for cannabis merchants are highly restrictive, which flows through to a lack of flexibility in their business model.
The other key piece of US legislation is the MORE Act, which would declassify marijuana as a Schedule 1 drug, but with a US election scheduled for November 3 that’s unlikely to come up for passage before the end of the year.
On local markets, it’s been a solid week for pot stocks as 18 of the 34 companies tracked by Stockhead posted a gain, with nine unchanged while just seven lost ground.
Below is a summary of fortnightly and annual price performance for ASX-listed cannabis stocks:
Scroll or swipe to reveal table. Click headings to sort.
Leading the pack this week was Botanix Pharma (ASX:BOT), which rose by another 50 per cent to cap off a huge month of September despite relatively little news flow.
The rally caught the eye of the ASX, which issued a price query on Tuesday, but Botanix advised it was not aware of any information that could explain the price action.