Market Talks covering the impact of U.S. Politics and White House policies on companies and markets. Published exclusively on Dow Jones Newswires throughout the day.
1534 ET - The prospect of slowing or pausing AI development doesn't herald any change to the fundamentals of the AI infrastructure buildout, Morgan Stanley co-president Dan Simkowitz says in a CNBC interview. "I think the pause or the slowing of release on the frontier really doesn't change the core dynamics," Simkowitz says, adding that spending on computing power and semiconductors doesn't show any signs of stopping. "The pacing at the frontier doesn't change the build, it doesn't change the demand, and it doesn't change the financing of that demand." He adds that capital markets remain ready for large M&A activity and IPOs. (elias.schisgall@wsj.com)
1526 ET - Sen. Kirsten Gillibrand (D., NY) voted no on a measure to advance the Clarity Act, a piece of legislation backed by President Trump that would boost the cryptocurrency industry. The measure was ultimately defeated 49 to 50. Gillibrand was the Democrat that Republican Sen. Cynthia Lummis (Wyo.) has been leaning on in her arguments that the bill had bipartisan support. The senators introduced legislation together in 2022 to try to establish a framework for digital assets. Lummis praised Gillibrand at a conference on Friday for her work in pushing the Clarity Act forward. Ahead of Gillibrand's no vote, her Democratic colleague Sen. Elizabeth Warren voiced concerns that the bill lacked adequate safeguards against corruption in the light of President Trump's deep financial ties to the crypto industry. (dean.seal@wsj.com)
1243 ET - The U.S. exported a record 2.2 billion gallons of ethanol in 2025 worth $4.7 billion, and exports of the biofuel were up 12% in the first half of this year by volume and 21% by value, the USDA says in a report, noting growing global demand and reduced competition from Brazil. A number of wildcards--both positive and negative for U.S. exports--could have an impact the rest of the year, the USDA adds. Brazil could recover export market share if its production outpaces domestic consumption growth. In the U.S., producers can benefit from a tax break they couldn't previously use, although policy changes to increase consumption such as a nationwide E15 mandate could limit exportable supply and push up prices. Demand could rise further as countries respond to higher energy prices caused by the Middle East conflict. "Ethanol prices have not spiked like oil and gasoline, giving ethanol an advantage and encouraging higher blending as a method to reduce prices at the pump." (anthony.harrup@wsj.com)
0905 ET - While on stage at a tech summit, Nvidia CEO Jensen Huang puts President Trump on speakerphone, giving the president a chance to push back on recent safety concerns over AI. "It's all a hoax," Trump says. Trump defends AI and data centers as an economic driver for the U.S., forecasting that AI will be "the oil of the next 20-25 years--it's bigger than the internet." Huang, who has said that the AI warnings are aimed at boosting business for cybersecurity firms, tells Trump he agrees with his views. (kelly.cloonan@wsj.com)
0610 ET - Investors are less convinced that the Federal Reserve will refrain from raising interest rates before November's U.S. midterm elections, Bank of America's global fund manager survey for September shows. Some 52% of investors expect no rate rise before the midterms, down sharply from 72% in the August survey. The survey shows 41% now expect a rate rise before the midterm elections, compared to 22% in August. (renae.dyer@wsj.com)
0257 ET - The U.S. dollar rises as investors anticipate the Federal Reserve will increase interest rates on Wednesday amid elevated oil prices as the Middle East conflict worsens and strong U.S. inflation and jobs data. High oil prices exacerbate inflation concerns, causing yields to rise, additionally boosting the dollar as the U.S. is an oil exporter. "Monetary policy may not be well suited to offsetting the current supply shock, but there's a need to keep inflationary expectations dampened," says BNY's John Velis in a note. Money markets are pricing in a 93% chance of a Fed rate hike this week, LSEG data show. The DXY dollar index rises 0.3% to 99.683, having hit a one-month high of 99.736 on Monday. (jessica.fleetham@wsj.com)
0142 ET - U.S. Treasury yields rise across maturities in Asian trade after the 10-year yield rose above 5% for the first time since October 2023 on Monday. Investors await the Federal Reserve's rate decision on Wednesday, with a 25bp hike priced in with a 93% probability, according to LSEG. "Logic would suggest that a rate hike should calm the back end," ING's rates strategists say in a note. "However, the back end is super flighty," they say. The two-year yield is up 4.4 bps at 4.676%, while the 10-year Treasury yield rises 6.2 bps to 5.021%, according to Tradeweb. (emese.bartha@wsj.com)
0026 ET - Faster price increases in India, driven by costs of food and oil and rising core inflation, strengthen the case for a shallow rate-hiking cycle, Nomura analysts Sonal Varma and Aurodeep Nandi say in a note. Consumer prices rose 4.8% on year in August from 4.5% in July, while core inflation accelerated to 4.2% from 3.9%. The bank now expects 50 bps of rate hikes in 4Q, with the Reserve Bank of India raising rates in October and December. Nomura has raised its fiscal 2027 inflation forecast to 5.1% from 4.6%, above the central bank's 5.0% projection.(venkat.pr@wsj.com)
0017 ET - Treasury Secretary Bessent reiterated his support for the crypto Clarity Act ahead of a key Senate vote, calling the legislation "essential to ensuring America wins the global race for new technology." Bessent said on X that the act's final draft furthers the administration's mission of enabling digital technology while supporting community banks. That's been a point of contention, with critics worried that the legislation doesn't do enough to protect community banks from deposit flight caused by interest-like payments on stablecoin balances. Bessent said the draft gives the Treasury additional authority to safeguard community banks. "If stablecoins cause harm to community banks, I will not hesitate to use these tools to ensure they remain fully protected." The upcoming vote will decide if the act enters final voting procedures or gets pushed back. (fabiana.negrinochoa@wsj.com)
2224 ET - Asian currencies mostly weaken in Asian trade, after the 10-year U.S. Treasury yield surged above 5% on Monday before settling at 4.960%. The rise in Treasury yield was driven by persistent inflation concerns, elevated oil prices, large government borrowing requirements, and heavy corporate issuance associated with artificial intelligence investment, Commerzbank Research analysts say in a note. The 5% level is psychologically and economically significant, they note, as sustained yields above the level would further tighten financial conditions. The U.S. dollar rises 0.3% to 154.82 yen and 0.45% higher at 1353.14 won, while the Australian dollar is 0.15% lower at US$0.7126, LSEG data show.
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