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.

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.(amanda.lee@wsj.com)

1315 ET - Policymakers need to get in the same room with AI company leaders this week to address the latter group's request for more industry oversight and slower development of the technology, Melius Research analysts say in a research note. Anthropic CEO Dario Amodei has called for national legislation requiring frontier-model testing, employee-level access for external evaluators and tighter controls for adversaries in China, they say. Some senators are drafting a bipartisan bill that could be introduced this week, which would likely try to impose a "duty of care" on frontier developers, the analysts say. That would give the government authority to block an unsafe model release and create a framework for labs to test for catastrophic cyber, biological and nuclear capability, they say. (dean.seal@wsj.com)

1239 ET - Investors in the AI trade shouldn't get hysterical about top AI company leaders calling for a development slowdown and more guardrails for the industry, Melius Research analysts say in a research note. The top AI CEOs have been endorsing a slowdown for several years already, and most AI leaders have thought the space was bound for regulation anyway, they say. If anything, Anthropic and OpenAI are the companies that can benefit most from a regulatory framework that creates a predictable playing field for the most well-resourced and advanced companies, the analysts say. "It can be morally right and advantageous at the same time," they say. (dean.seal@wsj.com)

1213 ET - Diesel futures pull back from early highs as President Trump says Ukraine and Russia have agreed to stop attacks on each other's energy infrastructure. Ukrainian drone strikes that have knocked out Russian refining capacity have contributed to global diesel shortages while U.S. exports have been at record highs. "Ukraine has agreed not to hit Russian energy targets. Russia has agreed to do likewise!" Trump posted on Truth Social. He adds that the rise in diesel prices is mostly due to the Russia-Ukraine war, and not Iran. Nymex diesel futures are up 0.4% at $4.9771 a gallon. Gasoil futures on ICE Futures Europe are down 1.2% at $1,462 a metric ton. (anthony.harrup@wsj.com)

0445 ET - Crypto markets await a vote this week that decides whether the Senate will begin debating the Clarity Act. A lack of progress this quarter risks crypto slipping down the policy agenda ahead of midterms, says Sygnum CIO Fabian Dori. The vote outcome turns on whether at least seven Democrats or independents are satisfied on issues around ethics and stablecoin yields. Sygnum's research argues that the core market-structure framework is largely settled and the dispute holding up the act is political. More delays could happen if leadership pulls the vote if the count is short, or the bill stalls in amendments and reconciliation with the House text. With roughly two working weeks before the midterm campaign closes the floor, a slip past September is in effect a deferral to the next Congress, Dori says. (fabiana.negrinochoa@wsj.com)

0433 ET - The upcoming Senate cloture vote is the crypto Clarity Act's most immediate obstacle, says Andrew Melville, head of research at institutional crypto derivatives data and analytics firm Block Scholes. The Sept. 15 vote can end the debate on the motion to proceed and begin the process of bringing the crypto bill for a final vote. Melville notes that the bill is also up against tight session timelines interrupted by the Midterm elections. The version being debated in the Senate also has significant revisions and must be reconciled with the version the House passed before President Trump can sign off on it. "If the measure is not enacted before the 119th Congress ends on 3 January 2027, it will expire and must be reintroduced in the new Congress." (fabiana.negrinochoa@wsj.com)

0426 ET - There's a lot of optimism around the cryptocurrency industry's Clarity Act after progress on ethics provisions, but it remains a political hot potato, says Nic Puckrin, cross-asset analyst and founder of Coin Bureau. Senate Republicans have released a draft of the legislation they say reflects bipartisan negotiations and 126 substantive changes requested by Democrats. But Puckrin says it's not only the Democrats who have to be convinced. "There are also Republicans who oppose stablecoin yield rules and are concerned about the impact on community banks." He still thinks the act is unlikely to pass this year. There's a longer road ahead, and that will likely put a cap on any relief rally. (fabiana.negrinochoa@wsj.com)

0048 ET - The bar for a rate "hold" by the Fed is high and would certainly lead to more dissent than at the July meeting, says Christian Scherrmann, DWS Chief U.S. Economist. He reckons a Fed rate hike would not be a surprise, but also sees a scenario in which it doesn't happen. While a hike would likely pay off in terms of credibility and managing inflation expectations, with no forward guidance, markets could anticipate a more prolonged tightening cycle. Meanwhile, a Fed rate hold could further increase yields as markets adjust to inflation expectations. "The likely middle ground would be a hawkish hold or a dovish hike," he says. Either option would require precise communication to be successful. "This would certainly be risky for a Fed chair who likes to keep his cards close to the chest."