Stocks in cannabis companies jumped on Monday because of news on the marijuana banking reform in Congress. Senate Majority Leader Chuck Schumer (D-N.Y.) said that the Senate is on course to pass new cannabis banking rules soon.
While this isn’t the first time announcements on progress have been made, only for nothing much to happen, investors jumped on this news and as a result stocks on cannabis company were up.
Canopy Growth (NASDAQ:CGC), Cronos Group (NASDAQ:CRON) and Aurora Cannabis (NASDAQ:ACB) all benefited.
The House of Representatives has passed versions of the Secure And Fair Enforcement Regulation (SAFER) Banking Act seven times in the past, but they have all failed in the Senate. However, the current act has bipartisan Congressional support and could pass in the coming months. This would allow marijuana companies to take out loans and use other banking services, lowering the cost of doing business and thus improving the companies’ profits.