Cannabis Stocks Find a Spark on Hopes for Looser US Pot Laws

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Shares of Canadian cannabis producers lit up traders’ screens bright green on indications that President Donald Trump will soften US weed regulations to make it easier to buy and sell the drug.

Canopy Growth, once the sector’s bellwether, soared 54% in New York today. In Toronto, Curaleaf led the S&P/TSX Composite by a mile, gaining a whopping 38%.

The sector has had a rough time since Canada legalized recreational marijuana in 2018. Initial overexuberance and frothy valuations were soon punctured by some hard business realities: It’s difficult to make money in a crowded market that still competes with cheap, black-market pot. Since the end of October 2018, the month of legalization, Canopy and Tilray Brands shares have lost nearly all of their value, while Curaleaf has fallen by nearly half.