Weed stocks are rallying after Michigan legalizes marijuana for recreational use

A woman holds marijuana for sale at the MedMen store in West Hollywood. REUTERS/Lucy Nicholson

Thomson Reuters

• Voters in Tuesday's midterm elections made Michigan the 10th US state to legalize the recreational use of marijuana.

• Utah and Missouri legalized the medical use of marijuana.

• Weed stocks were rallying across the board Wednesday.

• Watch Aurora Cannabis, Aphria, Canopy Growth, Cronos Group, and Tilray trade live.

Weed stocks were gaining ground early Wednesday after Michigan became the 10th US state to legalize marijuana for recreational use. Voters rejected a similar measure in North Dakota, while the legalization for medical use passed in both Utah and Missouri.

Following the results, cannabis producers were rising across the board. Here's a look at the premarket scoreboard at 7:15 a.m. ET on Wednesday:

• Tilray (TLRY): +7.04%

• Aphria (APHA): +5.12%

• Cronos Group (CRON): +4.23%

• Aurora Cannabis (ACB): +3.8%

• Canopy Growth (CGC): +3.56%

Cannabis stocks have captured the attention of both Main Street and Wall Street this year. In August, Constellation Brands, the maker of Corona beer and Svedka vodka, announced a $4 billion investment in Canopy Growth. That led to a "green rush" into the sector, with market values of the biggest names more than doubling.

Last month, Canada became the second country to legalize marijuana for recreational use, putting a top in shares. But the future remains bright for the sector.

"We believe that the legalization in Canada offers a road map to invest in the companies that will form the basis of the legal cannabis industry in the coming years," Jon Trauben, a managing partner at the cannabis-focused Altitude Investment Management, said.

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