Investor confidence in the American cannabis industry is rising again after months of decline. Much of the attention centres on CBD—short for cannabidiol—a non-intoxicating chemical found in hemp that is often sold in oils, gummies and creams.
The so-called “Trump effect” describes sudden optimism in financial and retail circles after Donald Trump’s public comments or perceived policy shifts.
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In cannabis, it reflects expectations that a future Trump administration could soften federal rules, encouraging investors and retailers to return to a market that has stagnated.
What the ‘Trump effect’ means for cannabis retail
The latest wave of enthusiasm began in September when Trump posted a video on his Truth Social platform promoting the idea that Medicare, the US health programme for older citizens, might cover CBD products. That signal, even without formal policy, helped reignite bets on cannabis retail.
Although the claim was not verified by any government agency, the post sent cannabis stocks soaring overnight. Major listed companies such as Tilray Brands, Aurora Cannabis and Canopy Growth all saw double-digit gains within hours.
Market analysts say this surge, dubbed the “Trump effect,” reflects investors’ belief that even a symbolic endorsement could open the door to policy reform.
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By GlobalData“It’s a sentiment shift,” said Adam Smith of the Marijuana Policy Project, a Washington-based advocacy group. “When Trump hints at support for cannabis products, markets interpret it as a signal that wider Republican backing might follow.”
While no formal policy changes have been announced, the prospect of federal easing has reignited interest in cannabis retail.
Investors are watching whether marijuana will be reclassified under federal drug laws, a move that could reduce financial barriers for dispensaries and attract new entrants to the market.
Hopes pinned on marijuana rescheduling and CBD reform
The US Drug Enforcement Administration (DEA) is currently reviewing whether marijuana should be moved from Schedule I—alongside heroin and LSD—to Schedule III, where drugs such as anabolic steroids sit.
Rescheduling would not legalise cannabis nationally but would lift severe tax and banking restrictions that have weighed on retailers for years.
For cannabis shops and suppliers, this could mean lower borrowing costs, wider banking access and the ability to deduct business expenses from tax—rights denied under current law.
“If rescheduling happens, retailers will finally have breathing room to operate like normal businesses,” said Michael Mayes, chief executive of the cannabis consultancy Quantum 9.
Alongside the federal review, US lawmakers are debating new regulations for hemp, the low-THC variety of the cannabis plant used to produce CBD. Since hemp was legalised under the 2018 Farm Bill, a flood of unregulated products has entered shops, from gummies and oils to drinks and cosmetics.
Congress is now considering national standards for labelling, testing and safety—rules that could benefit retailers with compliant supply chains while squeezing out smaller operators selling untested goods.
Retail challenges in a shifting legal landscape
For cannabis retailers, the combination of potential reforms and political uncertainty presents both risk and opportunity. The industry remains fragmented, with each US state maintaining its own licensing, packaging and sales regulations.
Federal recognition of CBD or changes to marijuana’s classification could simplify compliance, helping large chains expand across state lines.
Yet safety concerns remain. Studies by the US Food and Drug Administration (FDA) have found that many CBD products are inaccurately labelled or contaminated. The agency has approved only one CBD-based medicine, Epidiolex, for rare seizure disorders.
Experts warn that scientific evidence for most other health claims remains limited, meaning retailers must tread carefully when marketing wellness products.
Demand remains strong despite uncertainty
Consumer appetite continues to grow. Research from Carnegie Mellon University shows that daily cannabis use in the US now exceeds daily alcohol consumption, a historic first.
The Department of Agriculture estimates the annual value of cannabis production rose 40 per cent last year, while analysts at Grand View Research predict the global market for cannabis-derived goods could reach US$160 billion by 2032.
Retailers say this demand, combined with the chance of regulatory reform, could mark a turning point. “If federal rules bring clarity, investment and compliance will follow,” said Tilray chief executive Irwin Simon. “That’s what sustainable growth looks like.”
Outlook for 2026
In the months ahead, the cannabis retail sector will be shaped by three forces:
The outcome of the DEA’s rescheduling review; the wording of the next Farm Bill covering hemp and CBD; and political signals from Trump and his advisers as the 2026 campaign season intensifies.
Whether the “Trump effect” proves lasting or short-lived, it has already reignited debate about how the US regulates one of its fastest-growing consumer industries.
For now, cannabis retailers are preparing for both possibilities—regulatory relief that could legitimise their business, or continued uncertainty that keeps them operating in the grey zone of America’s divided drug laws.
