The best-case scenario for cannabis would be a total blue wave, Azer said. It’s also possible the House flips to a Democratic majority and the Senate holds, meaning blue-state lawmakers would likely just focus on moving pro-cannabis bills out of the House. If nothing else, a Democrat-controlled House would help shore up blue-state finances, which lost certain state and local tax deductions in the GOP tax bill, Azer said.
If the blue wave fizzles and Republicans keep a majority throughout Congress, cannabis will likely remain status quo with a potential boost from the removal of Sessions.
State races are also key for the future of marijuana and the high-flying stocks. Gubernatorial races in Florida, Connecticut, New Hampshire, Rhode Island, New York and Illinois have the potential to swing blue. If both adult use measures pass in those states, total use could expand to roughly 43 percent of the population, accounting for 47 percent of GDP, Azer said.
Michigan and North Dakota are both voting on adult marijuana use ballot measures in November, while Utah and Missouri will vote on the legalization of medical cannabis. Should adult use access expand to 10 states, that would cover roughly 25 percent of the population and 28 percent of GDP, according to Cowen’s estimates.