Trump, Harris And Cannabis Stocks: Are Election Results Already Priced In?

The U.S. heads into another historical election, the outcome of which will have an effect on cannabis stocks.

With both major candidates, Donald Trump and Kamala Harris, supporting cannabis reform, investors are closely watching the sector. These past few days, volatility has taken the stage as many have decided to take profits from the recent rally.

However, Trump's recent rise in the polls might be adding complexity, as the market legitimately questions whether his pro-cannabis stance is genuine or merely a strategic move to gain votes.

Let’s look at how major cannabis stocks are responding to this uncertain political landscape.

Trulieve Cannabis (TCNNF)

Trulieve TCNNF’s stock saw a period of gains, followed by a sharp drop in recent sessions, likely driven by profit-taking and election-related uncertainty. The volume spike in this downturn indicates strong selling interest. The bearish MACD signal underscores a cautious sentiment taking over.

Chart created using Benzinga Pro

AdvisorShares Pure Cannabis ETF (YOLO)

The AdvisorShares Pure Cannabis ETF YOLO, which represents a basket of cannabis companies, mirrors Trulieve's recent pattern, with a strong rise followed by a sharp decline. Increased volume on down days suggests that investors are tempering their optimism as the market appears hesitant to price in cannabis reform. The recent MACD crossover to bearish territory also reflects this hesitation.

Chart created using Benzinga Pro

AdvisorShares Pure US Cannabis ETF (MSOS)

The AdvisorShares Pure US Cannabis ETF MSOS representing U.S.-based cannabis companies, also saw a strong rally followed by a sharp decline. Increased volume on the downturn highlights investor skepticism. Again, the MACD turning bearish underscores a shift from optimism to caution.

Chart created using Benzinga Pro

Tilray Brands (TLRY)

Tilray TLRY’s stock has been relatively stable, showing a lack of strong momentum in either direction, which might just be consolidation. This range-bound movement normally reflects investor indecision as they wait for clearer signals. The stock is neutral regarding MACD and is building resistance around $1.65.

Chart created using Benzinga Pro

Ispire Technology (ISPR)

Ispire Technology ISPR is seeing a sustained downtrend with selling pressure intensifying as election day approaches. The increased volume on down days and the bearish MACD signal indicate slight investor pessimism.

Chart created using Benzinga Pro

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Scotts Miracle-Gro (SMG)

Scotts Miracle-Gro SMG stands out with continued upward momentum and a bullish MACD, suggesting relative strength in the sector. Unlike more cannabis-focused stocks, Scotts' diversified product line provides a cushion and might be appealing to investors seeking stability.

It also speaks to the slight pessimism cannabis stocks are facing, which might be related to upcoming elections.

Chart created using Benzinga Pro

Read Also: Canada’s Cannabis Market Goes Cold, Pot Prices Hit Bottom: Why Top Producers Are Losing Ground

Is The Market Pricing A Trump Victory?

If we considered the sentiment of a Trump victory, parting from his momentum in current polls, then we might push forward the following hypothesis: despite Trump's recent statements supporting cannabis rescheduling, market behavior is suggesting skepticism. The downward trends in recent rounds suggest a link between a Trump potential victory and investors’ selling sentiments. Trump is still behind Harris in most polls but the gap is closing quickly.

While Trump's corporate tax cuts could benefit companies in general, one of the main problems cannabis companies face is 280-E, a burden that will be taken out of the corporations’ backs if cannabis is rescheduled. At this point, given the result of recent rounds, investors might be doubting Trump’s commitment to reform.

As the election day draws closer, cannabis stocks remain in a delicate balancing act, which investors would be wise to watch closely.

• Read Next: Almost Every Major Cannabis Company Could See Positive Cash Flow If 280E Is Removed In 2025

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