Tech Rally Lifts Indices as Focus Shifts to October Payrolls

US equity benchmarks posted their best session since early August on Monday, with the S&P 500 climbing 1.49% to 7,764.70 and chipmakers surging on AI optimism. Meta Platforms jumped 11% as early signs of success for its AI agent sparked enthusiasm about the industry, while Advanced Micro Devices topped $1 trillion in market cap. The rally came just days after the Federal Reserve raised its benchmark interest rate by 25 basis points to a target range of 3.75%-4%, its first increase since 2023. Brent crude settled around $100 and Treasury 10-year yields fell below 5%, offering relief to rate-sensitive sectors.

European equities showed mixed behaviour through mid-September. Frankfurt's DAX 40 closed about 1.6% down at 25,296 on Friday, its lowest since late July, as caution returned to markets. The chart captures that weakness: the hourly DAX view from late August through September 22 shows the index peaking near 26,611 in late August before falling to a low near 23,249 on September 18. The ECB raised its Deposit Facility Rate by 25 basis points to 2.50% at its September 10 decision, adding pressure to eurozone stocks alongside elevated oil prices.

What the calendar says

The most significant release in the week ahead falls on October 2 at 12:30 UTC — the US nonfarm payrolls report from the Bureau of Labor Statistics. This data point moves EUR/USD, GBP/USD, USD/JPY, and gold by determining whether the Fed's hawkish pivot continues or stalls. August nonfarm payrolls grew 162,000, much more than the 53,000 that economists polled by Dow Jones expected, triggering the Fed's rate-hike calculus. A similarly strong October print would keep upward pressure on the dollar and Treasury yields. Our full schedule lives on the economic calendar.

S&P 500: hourly chart, August 31–September 22

The index opened the period near 7,693 on August 31 and climbed to a local peak of 7,785 early September before consolidating. A sharp dip to 7,555 on September 16 marked the session ahead of the Fed decision; from that low the index has rallied back to 7,785 by September 22. Immediate resistance sits at the 7,785–7,800 zone, with support at 7,700 and then the mid-September low at 7,555. The bounce suggests markets have absorbed the rate hike, but the next jobs print will determine whether the uptrend resumes or yields force another correction.

DAX 40: hourly chart, August 28–September 22

The index began August 28 near 26,700 — close to its all-time high — then fell steadily through early September. A brief recovery toward 26,050 stalled, and the real break came after mid-month: the DAX dropped from 25,810 on September 17 to 23,249 on September 18, coinciding with quadruple-witching volatility and the Fed's hawkish turn. The index has since recovered to approximately 25,522 as of the chart's latest candle on September 22. Key levels to watch are resistance at 25,800 and support at 25,000; a move back below that round number would retest the 23,250 lows. Investors are eyeing developments in the Middle East ahead of next week's summit between US President Trump and Gulf-state leaders, which could drive further energy-price and risk-sentiment swings.

Both benchmarks now trade in a tighter range after absorbing September's policy surprises, leaving the October payrolls release as the next catalyst for direction. Traders holding positions over the data should monitor trading conditions and size accordingly for potential whipsaw.