BANGKOK (AP) — Shares slipped in Asia on Thursday after benchmarks fell more than 1% on Wall Street in the middle of a mostly quiet and holiday-shortened week.

U.S. futures were mixed and oil prices declined.

Tokyo’s Nikkei 225 index lost 1.3% to 25,990.68.

The Hang Seng in Hong Kong shed 1.1% to 19,681.70, while the Shanghai Composite index was down 0.3% at 3,077.80.

Investors are watching to see how China’s relaxation of its stringent COVID-19 policies, and the outbreaks of infections that have followed, will affect business activity and travel.

One concern is that the massive outbreaks could generate new, potentially vaccine resistant variants of the virus, “leading to knock-on virus surges across the globe, China’s reopening could still mark a positive step over the long run in light of past global attempts in bringing virus cases under control,” Yean Jun Rong of IG said in a commentary.

Australia’s S&P/ASX 200 gave up 1.2% to 7,004.40. Bangkok’s SET index edged 0.1% higher.

The Kospi in Seoul sank 1.8% to 2,240.81 on news that South Korea’s industrial production fell minus 3.7% from a year earlier in November, worse than forecast and a bigger drop than the minus 1.2% the month before. Retail sales were down 1.8% from the month before.

The worst year since 2008 for the S&P 500 has been winding down with little in the way of data to drive trading. But later Thursday, the U.S. government was due to release jobless claims, a measure of employment that could provide insight into how the economy is faring as the Federal Reserve raises interest rates to quash inflation.

The Fed has already raised its key interest rate seven times this year and is expected to continue raising rates in 2023. The key lending rate, the federal funds rate, stands at a range of 4.25% to 4.5%, and Fed policymakers forecast that the rate will reach a range of 5% to 5.25% by the end of 2023. Their forecast doesn’t call for a rate cut before 2024.

On Wednesday, the S&P 500 fell 1.2%, with technology, energy and industrial stocks among the biggest weights on the benchmark index. It finished at 3,783.22.

The Dow Jones Industrial Average dropped 1.1% to 32,875.71. The Nasdaq slid 1.4% to 10,213.29. The Russell 2000 gave up 1.6%, ending at 1,722.02.

Bond yields were mixed. The yield on the 10-year Treasury, which influences mortgage rates, rose to 3.88% from 3.85% Tuesday. The yield on the two-year Treasury fell to 4.34% from 4.38% late Tuesday.

With two more days of trading left in 2022, the S&P 500 is headed for a roughly 20% drop for the year, even as profits and margins for companies in the index have hit record heights this year. The Dow is on pace for a 9.5% drop, while the Nasdaq is doing much worse, on pace to plunge 34.7%.

Southwest Airlines slid 5.2% as the carrier grappled with the fallout after cancelling thousands of flight cancellations. The airline’s CEO said it could be next week before the flight schedule returns to normal. Shares in other airlines also fell. Delta Air Lines dropped 2.8% and United Airlines fell 2.4%.

Tesla rose 3.3% as it stabilized from steep losses it suffered after reports Tuesday that it temporarily suspended production at a factory in Shanghai.

U.S. crude oil prices settled 0.7% lower and natural gas prices plunged 10.8%. That hurt energy stocks. Exxon Mobil fell 1.6%.

Early Thursday, U.S. benchmark crude was down 41 cents at $78.55 per barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the pricing basis for international trading, gave up 43 cents to $83.56 per barrel in London.

The U.S. dollar fell to 133.85 Japanese yen from 134.39 yen late Wednesday. The euro rose to $1.0624 from $1.0613.

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AP Business Writers Damian J. Troise and Alex Veiga contributed.

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