Michigan voted to legalize marijuana for recreational use, ending decades of prohibition and ushering in a new era of cannabis law and a burgeoning cannabis industry.
Cannabis stocks got an initial boost following Tuesday's midterm election results that largely favored the marijuana industry. Shares of major cannabis companies rallied during Wednesday's premarket. Tilray gained as much as 6.6 percent; Canopy Growth added 3 percent; Aurora Cannabis rose 3.6 percent; Cronos Group was 4.2 percent higher; and Aphria was up 2.4 percent. All retreated from most of the gains by midday.
"I think people are waiting for the Berlin Wall of cannabis prohibition to topple over in the U.S. and I think yesterday's election removed a few more bricks from that wall," Tilray CEO Brendan Kenny told CNBC on Wednesday.
Michiganders chose to authorize the legalization of possession, use and cultivation of marijuana products by those who are at least 21 years old. Individuals will now be permitted to possess and use marijuana and marijuana-infused edibles and grow up to 12 marijuana plants for personal consumption. The approved law will impose a 10-ounce limit for marijuana kept at residences and mandate that amounts over 2.5 ounces be secured in locked containers.