Trading in US index futures suggests stocks could reverse course on Friday after a scintillating rally in the previous session. A regional production gauge, bond yields and oil price direction are among the catalysts that can influence trading in the last trading session of the year.

US stocks made solid gains on Thursday as the year-end rally that many had been hoping for took place in the penultimate session of the year. The gap in the major indices opened higher, rising steadily into early afternoon trading. After that, they moved sideways before ending the session significantly higher. The Nasdaq Composite recovered from a renewed bear market bottom it had hit in the previous session.

Shares in all sectors rose on Thursday, with battered technology and consumer discretionary stocks outperforming the rest.

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Some of the strength may also have to do with the weekly jobless claims report, up from the previous reporting week, and a slight decline in the US 10-year Treasury yield.

“However, jobless claims are still too low to influence Fed policy, so a February 1 interest rate hike remains likely given rising Treasury yields this week,” the fund manager said Louis Navellier.

The US market, represented by the S&P 500 Index, is on course to end the year down over 19%. The future remains tense. Analysts at JPMorgan expect the S&P 500 Index to retest the 2022 lows in the first half of 2023 as the Fed over-tightens weaker fundamentals. “This sell-off, combined with disinflation, rising unemployment and falling business sentiment, should be enough for the Fed to signal a turnaround and propel the S&P 500-4200 to 4200.