Why Marijuana Stocks Dropped Today

Ever since the vice presidential debate last week, marijuana stocks have been on a tear. From Thursday’s open to Monday’s close, shares of Green Thumb Industries (OTC:GTBIF) are up 15%, Aphria (NASDAQ:APHA) has gained 24%, and industry giant Canopy Growth (NYSE:CGC) has surged 26%.  Not so today…

Today, marijuana stocks are taking a bit of a breather, and tic-tac-toe, three in a row, these stocks are all declining, falling 4%, 2.9%, and 5.8%, respectively, as of 11 a.m. EDT.

So what’s going on here? In the absence of any obviously bad news for the stocks in question — no negative earnings preannouncements, no bad earnings reports, and not so much as a critical peep out of Wall Street analysts — I suspect that what we’re seeing here today is profit-taking, plain and simple. For some investors, the temptation of cashing in on a 15% profit in just three trading days may prove too great to resist.

That being said, there is one bit of actual marijuana news that may be playing an outsized part in today’s cannabis sell-off. Specifically, in a report last night, Bank of America laid out the roadmap for the prospects of marijuana legalization — and the growth of the marijuana industry — going forward.

On the one hand, rising poll numbers for the Biden/Harris ticket, combined with Senator Kamala Harris’ promise last week to “decriminalize marijuana, and … expunge the records of those who have been convicted of marijuana” related crimes after the election, certainly sounds like good news for cannabis investors. On the other hand, though, in making its report, Bank of America listed several preparatory steps that will need to…

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