Last week’s brief market pullback has quickly faded, with US equity futures surging Monday morning. Technology and small-cap stocks are leading gains as the S&P 500 moves toward a fresh all-time high. As of 8:00 a.m. ET, S&P futures were up 0.5%, off earlier session peaks but still positioning the index for its strongest September performance since at least 2013—despite the month’s typically weak seasonal trend.Mega-cap tech and semiconductor names are mostly higher in premarket trading, and cyclical stocks are outperforming defensives following last week’s wobble. The renewed strength in the AI theme is helping lift European equities broadly into positive territory. Asian markets also advanced, driven by a rebound in Chinese technology shares. The Hang Seng rose for the first time in three sessions.Gold extended its rally to a new record above $3,820, pushing the estimated value of US gold reserves past $1 trillion. The move comes as concerns intensify over a potential US government shutdown, now less than 48 hours away. The dollar weakened as the shutdown deadline approaches Tuesday at midnight. The yen strengthened below the 149 level, the euro gained 0.2%, and the yuan appreciated following stronger industrial profit data and a firm PBOC fixing. The US 10-year Treasury yield slipped three basis points to 4.15%.Oil prices were under pressure, with WTI crude hovering near $65.30 amid expectations that OPEC+ will increase output. Broader commodities were softer, excluding precious metals and coffee, which continue to rally.This week features a heavy slate of economic data, complicated by the possibility of a government shutdown that could delay key releases, including labor market figures. Federal Reserve officials are also highly active, with 12 scheduled speakers.
In premarket action, most of the "Magnificent Seven" traded higher: Amazon +1%, Alphabet +0.8%, Meta +0.6%, Nvidia +0.8%, Tesla +0.7%, Microsoft +0.3%, while Apple slipped 0.2%.Merus surged 37% after Denmark’s Genmab agreed to acquire the biotech firm for $8 billion. Conversely, MoonLake Immunotherapeutics plunged 88% following disappointing late-stage trial results for its skin disease treatment. Occidental Petroleum gained 1.5% on reports it is in talks to sell its OxyChem unit for at least $10 billion. Tilray jumped 16% alongside other cannabis stocks after President Trump highlighted the medical benefits of hemp-derived CBD. USA Rare Earth rose 5% after announcing a cash-and-stock acquisition of UK-based LCM.The week’s economic calendar culminates with Friday’s nonfarm payrolls report. Markets are currently pricing in two Fed rate cuts by January to support the labor market. However, a shutdown could delay the release. Economists expect 50,000 jobs were added in September, matching the recent three-month average, with unemployment steady at 4.3%. Before that, Tuesday’s JOLTS report is projected to show fewer job openings, and Wednesday’s hiring data is expected to confirm continued cooling.Fed officials including Christopher Waller, Alberto Musalem, and Raphael Bostic are set to speak Monday.Goldman Sachs strategists remain constructive on equities through year-end, citing resilient US growth, reasonable valuations, and a more dovish Fed stance. They argue that equities often perform well during late-cycle slowdowns when policy support is in place and recommend buying dips, assuming recession risks remain contained.European markets followed Asia higher, with the Stoxx 600 up 0.4%. Mining and technology shares led gains, while energy and banking lagged. UCB shares soared 20% after rival MoonLake’s weak trial data. European miners advanced after Bank of America raised copper price forecasts. GSK climbed nearly 4% on news of a CEO transition. Novo Nordisk fell almost 3% following a downgrade from Morgan Stanley.Asian equities were broadly stronger, with the MSCI Asia Pacific Index up 0.5%. Alibaba and Tencent were among the largest contributors. Japanese markets underperformed due to ex-dividend effects and yen strength.Gold’s rally continued as investors sought safety ahead of the US shutdown deadline.
In currency markets, the Bloomberg Dollar Spot Index fell 0.2%. The yen led G-10 gains after a Bank of Japan official signaled a rising case for rate hikes. The euro advanced to $1.1722.In fixed income, the US 10-year yield eased to 4.14%. Australian yields fell across the curve, while UK gilts held gains as Chancellor Rachel Reeves addressed the Labour Party conference.WTI crude slipped 1.5% to $64.75 on expectations of higher OPEC+ production. Bitcoin rose 1%.Today’s US data includes August pending home sales and the Dallas Fed manufacturing index. Fed speakers throughout the day include Waller, Hammack, Musalem, and Bostic.**Market Snapshot:**- S&P 500 mini +0.5%- Nasdaq 100 mini +0.7%- Russell 2000 mini +0.7%- Stoxx Europe 600 +0.4%- 10-year Treasury yield 4.14%- VIX 15.82- Bloomberg Dollar Index -0.2%- Euro $1.1722- WTI crude $64.75/barrelBeyond markets, attention is focused on US political developments, including negotiations to avoid a government shutdown. President Trump is set to meet congressional leaders, while also hosting Israeli Prime Minister Benjamin Netanyahu to discuss a proposed Gaza peace framework. Meanwhile, geopolitical tensions remain elevated across Ukraine, the Middle East, and East Asia.Overall, markets are beginning the week with optimism, supported by resilient economic data and renewed AI enthusiasm. However, looming policy risks—particularly the US shutdown and key labor market data—could introduce significant volatility in the days ahead.