Shares of marijuana-tied companies were falling sharply on Wednesday, despite voters in several states casting their ballots in favor of legalized marijuana.
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Companies such as Canopy Growth, Aurora Cannabis, Tilray, and Cronos all saw declines of at least 7%. By comparison, the broader stock market averages were mostly higher, with the NASDAQ Composite surging more than 2% early Wednesday.
The stark declines in the marijuana space come after nearly 70% of voters in New Jersey voted to make marijuana legal for recreational purposes.
"We did it, New Jersey!" Gov. Phil Murphy tweeted Tuesday night. "Public Question #1 to legalize adult-use marijuana passed overwhelmingly tonight, a huge step forward for racial and social justice and our economy. Thank you to @NJCAN2020 and all the advocates for standing on the right side of history."
Arizona, Montana, and South Dakota also voted to legalize marijuana on Tuesday, joining 11 other states and Washington, D.C., in making weed legal.
Murphy has been pushing for marijuana legalization since he was elected in 2017.
“One hundred fifty million dollars. That’s what processing marijuana arrests costs New Jersey taxpayers every year — arrests that disproportionately impact young people of color and make it harder for them to get a job, a place to live, even a credit card,” Murphy said in a recent video.
Some 37,623 people in New Jersey were arrested on marijuana possession or distribution charges in 2017, which comes out to about one arrest every 15 minutes, according to an ACLU report last year.
Marijuana will be legal to buy and use for people over the age of 21.
Legislation to set up the legal market still needs to be passed, but with Murphy's support and a Democratic state legislature, that should happen soon.
The sale of marijuana will be subject to the state sales tax, which is 6.625%, and local government can slap on their own taxes. Other details, such as regulations around grow operations and legal possession amounts, also need to be ironed out.
FOX Business' Paul Best contributed to this story.