The United States has moved to ban imports of certain Canadian alcoholic beverages, dairy products and motorcycles, escalating trade friction between the two largest economic partners.
In a separate development, the European Union and Canada are pursuing a broader partnership covering trade and security, aimed at counterbalancing growing U.S. and Chinese global influence.
In energy markets, Brent crude climbed toward the $100-a-barrel mark after gaining as much as 1.6% to reach $99.50, its highest level since July. The rise followed a U.S. strike on Iranian tankers near the crude-export hub of Kharg Island, intensifying concerns about disruptions through the Strait of Hormuz. The Islamic Revolutionary Guard Corps issued a warning that all tanker crews near Kuwaiti and Bahraini piers should immediately abandon their vessels, whether anchored or docked, saying they would be targeted.
Asian equity markets advanced as investors digested the geopolitical developments. South Korea's Kospi Index climbed 1%, led by chip giants SK Hynix Inc. and Samsung Electronics Co. The Philadelphia Semiconductor Index rose 1.3% in New York trading, while the MSCI Asia Pacific Index gained 0.4%, driven by the information technology sector.
The yen strengthened for a third consecutive session, advancing 0.4% to 153.31 per dollar. Bloomberg's dollar gauge slipped 0.1%.
Market attention is also focused on U.S. inflation data due this week, ahead of the Federal Reserve's policy meeting scheduled for September 15–16, 2026. Economists expect the Consumer Price Index to have risen 0.4% in August from the prior month, with core CPI — excluding volatile food and energy — projected to increase 0.2%. If underlying annual inflation drops to 2.4%, it would mark the smallest year-over-year increase since 2021.
Krishna Guha, an Evercore ISI strategist, wrote in a Tuesday note: "Brace for a turbulent week, with inflation data set to swing market expectations for a Fed hold or hike next week – with knock-on effects on wider asset markets."
Chris Larkin at E*Trade, from Morgan Stanley, added: "With geopolitical tensions and oil prices on the rise, the markets may find it difficult to focus on much beyond the inflation discussion."
U.S. market movers included Skyworks Solutions, which rose 13.55% to $90.00, and Revvity, up 9.11% to $140.19. Losers featured Coinbase Global, down 10.10% to $172.11, and Axon Enterprise, falling 9.81% to $442.08.
