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.

1326 ET - The breakdown in trade relations between Canada and the U.S. is part of a wider continuing trade realignment, a story that is still being written, says BMO Capital Markets' Francois Trahan. The investment strategist says while people in Canada may think all that is needed is a new U.S. administration in two years and things can return to the norm, that isn't necessarily what lies ahead. "Friendly reminder that the Biden administration didn't remove the tariffs that were imposed on China during the first Trump administration." Trahan says a future administration may not have the ability to change the tariff policy because of the fiscal situation in the U.s. (robb.stewart@wsj.com; @RobbMStewart)

1323 ET - There is a divide between Canada and the U.S. that may make future negotiations over the U.S.-Mexico-Canada trade pact tough, says Steve Verheul, former chief trade negotiator for Canada. Speaking during a briefing organized by Bank of Montreal, Verheul says the two countries are increasingly in markets that move them further apart. Canada is likely to redouble efforts to diversify trading relationship, and there could be action on procurement and possible defense and energy-related issues, says the principal at public affairs agency GT. He doubts Canada will use energy or defense in any kind of retaliation against the U.S., but it will aggressively seek opportunities with other countries on areas like energy and critical minerals. (robb.stewart@wsj.com; @RobbMStewart)

0924 ET - Abercrombie & Fitch CFO Robert Ball says the company expects to recognize $120 million worth of tariff refunds this year. "We recognized $100 million in the second quarter and expect to recognize the remaining $20 million in the third quarter," he says on a call with analysts. Looking ahead, Abercrombie raises its full-year adjusted earnings and sales outlooks, in part to account for the tariff refunds. "While we benefited from a $100 million in tariff refunds (during the recent quarter), we beat our outlook by more than that on the bottom line," CEO Fran Horowitz adds. Abercrombie shares jump 16% premarket. (connor.hart@wsj.com)

0904 ET - Bath & Body Works says more than a third of its tariff refunds were offset by existing tariffs and input cost inflation in the second quarter. The fragrances retailer recorded a benefit of $80 million from refunds during the quarter. However, tariff and input costs dinged results by $30 million. Incremental investments in the company's Consumer First Formula strategy also offset the refunds by $35 million, mainly due to marketing costs. Adjusted earnings were 62 cents a share in the quarter, and would have been 31 cents a share without the refunds, Bath & Body Works says. Analysts were projecting 24 cents a share. (katherine.hamilton@wsj.com)

0817 ET - Canada's announcement of $20 billion retaliatory tariffs against the U.S. causes the Canadian dollar to weaken against dollar, although its losses are limited, says ING forex strategist Francesco Pesole. The limited move indicates that markets expect the U.S. and Canada will negotiate further and avoid a full-blown trade war, he says. Canada's announcement came a day after President Trump said the U.S. would raise tariffs on imports from Canada. However, the Canadian dollar could weaken further to reflect the current trade tensions with the U.S., Pesole says. "A move above 1.390 in U.S. dollar/Canadian dollar is very much warranted in the near term." The U.S. dollar rises 0.2% to a one-week high of 1.3874 Canadian dollars, LSEG data show. (miriam.mukuru@wsj.com)

0751 ET - Metal miners' stocks rise in London as copper prices hold near record highs. Higher copper prices are the result of markets adjusting for potential U.S. import tariffs next year, AJ Bell's Russ Mould writes. Copper trades flat at $14,385 a metric ton. Gold and silver slip but remain elevated, with gold contracts down 0.4% at $4,675.50 a troy ounce while silver contracts fall 0.2% to $68.52 an ounce. Hochschild Mining leads the sector, rising 7.3% after posting strong first-half earnings. Antofagasta adds 2.8%, while Fresnillo and Endeavour Mining jump 1.4% and 1.2%, respectively. Anglo American adds 1.1%.(josephmichael.stonor@wsj.com)

0645 ET - Renewed trade tensions between the U.S. and Canada could weigh on Canada's businesses and put pressure on prices and supply chains, Danske Bank's Alexander de Lellis Stroustrup says in a note. This could put further downward pressure on the Canadian dollar. On Tuesday, Canada announced $20 billion in retaliatory tariffs on U.S. goods after President Trump announced new levies on Canadian imports over the weekend. "As Canada goes 'tit-for-tat' the Trump administration is said to be weighing additional measures against it," Stroustrup says. The U.S. dollar rises to a one-week high of 1.3870 Canadian dollars, while the euro reaches a three-week high of 1.6186 Canadian dollars, LSEG data show. (miriam.mukuru@wsj.com)

0547 ET - The Canadian dollar falls to a one-week low against the U.S. dollar and a three-week low against the euro amid a trade spat between the U.S. and Canada. Trade talks collapsed and the U.S. imposed stiff new tariffs on Canadian goods last weekend, while Canada proposed retaliatory tariffs on U.S. goods. "The Canadian dollar weakened after Prime Minister Carney matched newly imposed U.S. tariffs with dollar-for-dollar retaliatory duties while rolling out emergency support for affected domestic industries," Tickmill Group's Patrick Munnelly says in a note. The U.S.-Canada trade dispute "remains a key tail risk" for the Canadian dollar. The U.S. dollar rose to a high of 1.3869 Canadian dollars, while the euro reached 1.6186 Canadian dollars, LSEG data show. (jessica.fleetham@wsj.com)

0502 ET - The U.S. dollar could weaken further against the Chinese yuan over the coming months, ING's Chris Turner says in a note. The dollar has weakened sharply versus the yuan since the middle of last week. However, the pace of depreciation could slow going forward, Turner says. The Chinese central bank could be displeased over the pace of renminbi gains recently, he says. In addition, the U.S. announcement about possible sanctions on Chinese entities with ties to Iran could affect the yuan's strength, he says. "Our base case assumes a gently offered dollar environment and dollar/yuan edging lower towards 6.70 over the coming months." The dollar is last at 6.7202 yuan, having traded just above 6.74 at the start of last week, LSEG data show. (miriam.mukuru@wsj.com)

0333 ET - Oil prices held below $90 a barrel as a flurry of positive headlines around U.S.-Iran peace talks soothed oil traders. In early European trading, Brent crude contracts for October delivery fall 2.5% to $86.38 a barrel, while WTI contracts fall 2.6% to $80.20 a barrel. Iran and Oman diplomats discussed a framework that would allow shipping to resume through the Strait of Hormuz, the countries said in a joint statement. Meanwhile, "anecdotal evidence suggests there is an increasing flow of vessels utilizing the Omani route through Hormuz," ANZ analysts said. In addition, Axios reported that around 40 ships transited the strait over the weekend, while The New York Times reported U.S. diplomats would return to the Middle East. (josephmichael.stonor@wsj.com)

0141 ET - U.S. Treasury yields mostly edge higher in Asian trade, having moved lower across the curve on Tuesday as oil prices fall. "The oil price decline [on Tuesday] gave breathing room to the government bond market, which saw yield declines of 5-7 bps in both the U.S. and Europe," SEB's Gustav Helgesson says in a note. "During the morning, however, U.S. yields are slightly higher," the macro strategist says. Oil falls Wednesday after Iran and Oman have unveiled a joint framework to restore safer navigation through the Strait of Hormuz, with Brent last trading 2% lower at $86.75 per barrel. The 10-year Treasury yield is up 0.6 bps at 4.643%, while the 30-year yield is up 0.8 bps at 5.181%, according to Tradeweb. (emese.bartha@wsj.com)

2241 ET - The Singapore dollar is steady against its U.S. counterpart in the Asian session amid reduced geopolitical risks in the Middle East that could bolster appetite for risky assets. "Diplomatic outreach eased escalation concerns" in the region, CIMB Treasury and Markets Research analysts say in a report. "Iran and Oman [are] reportedly set to discuss a permanent transit route through the Strait of Hormuz within 30 to 60 days," they write. Iran held talks with Oman about establishing a safe shipping route through the strait, with the Omani Foreign Ministry saying a temporary corridor could be announced soon. The U.S. dollar is little changed at 1.2692 Singapore dollars, LSEG data show.