# Wall St stocks fall, bond yields rise as China drops quarantine rule Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-12-29 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: U.S. stocks fall as bond yields rise on China’s COVID policy Meta Description: Discover why the S&P 500 and Nasdaq closed lower as U.S. bond yields climbed on China's COVID policy changes and economic data. Dive into the latest URL: https://financedigest.com/wall-st-stocks-fall-bond-yields-rise-as-china-drops-quarantine-rulehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-12-27t165531z1lynxmpeibq0d8rtroptp4global-deals-1736814663223-compressed.jpg) By Sinéad Carew NEW YORK (Reuters) – The S&P 500 and the Nasdaq closed lower on Tuesday after the release of U.S. economic [data at the start of a holiday-shortened week while bond yields](https://www.financedigest.com/stocks-yields-fall-data-suggests-u-s-economy-cooling.html "Stocks, yields fall; data suggests U.S. economy cooling") rose after China said it would scrap its COVID-19 quarantine rule for inbound travelers. U.S. Treasury yields rose as investors tried to assess the path of interest rate hikes from the Federal Reserve and eyed China’s [scaling back](https://www.financedigest.com/mifid-ii-why-you-should-not-scale-back-your-implementation-efforts.html "MIFID II: WHY YOU SHOULD NOT SCALE BACK YOUR IMPLEMENTATION EFFORTS") of restrictions. While [China’s changes were seen as a potential economic boost](https://www.financedigest.com/sterling-slips-as-boost-from-new-china-covid-rules-fades.html "Sterling slips as boost from new China COVID rules fades"), money managers were cautious about reports of increasing infection rates there. Meanwhile, U.S. economic releases showed that the advance goods trade deficit for November narrowed to $83.35 billion from the prior month’s $98.8 billion, while a separate report pointed to continued struggles for the [housing market as home prices](https://www.financedigest.com/buy-off-plan-to-beat-stalling-house-prices-and-falling-rental-yields-says-jean-liggett.html "“Buy off-plan to beat stalling house prices and falling rental yields” says Jean Liggett ") fell under rising mortgage rates. [Oil futures](https://www.financedigest.com/apple-seed-oil-market-2022-outlook-current-and-future-industry-landscape-analysis-2026.html "Apple Seed Oil Market 2022 Outlook, Current and Future Industry Landscape Analysis 2026"), after hitting a three-week high earlier in the day, were a mixed bag at settlement with restarts at some U.S. energy plants shut by [winter storms offseting hopes](https://www.financedigest.com/uk-retailers-turn-positive-on-sales-hopes-after-bleak-winter.html "UK retailers turn positive on sales hopes after bleak winter") for a recovery in demand after China’s latest easing restrictions. The [rise in Treasury yields put pressure on growth stocks](https://www.financedigest.com/stocks-rise-after-bank-sale-fuels-investor-risk-appetite.html "Stocks rise after bank sale fuels investor risk appetite") including the rate-sensitive technology sector, according to Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. “It’s a lack of anybody with the conviction to step in and buy right now,” said O’Rourke. The strategist also cited the weight of a sharp pullback for [electric car maker](https://www.financedigest.com/lack-of-electric-vans-opens-door-for-chinese-other-ev-makers.html "Lack of electric vans opens door for Chinese, other EV makers") Tesla Inc, which fell 11.4% on Tuesday for its lowest close since August 2020. Reuters reported Tesla plans a reduced production schedule in Shanghai in January, extending [output reductions it began this month](https://www.financedigest.com/japans-factory-output-posts-biggest-fall-in-8-months-on-weak-autos-chips-sectors.html "Japan’s factory output posts biggest fall in 8 months on weak autos, chips sectors"). Gene Goldman, chief investment officer at Cetera Investment Management, described Tuesday’s session as “lacklustre” as [investors were waiting for next week’s Fed meeting minutes and economic data such as the jobs report](https://www.financedigest.com/influx-of-one-time-investors-swapping-stocks-for-bricks-and-mortar-reports-agency.html "Influx of ‘one-time’ investors swapping stocks for bricks and mortar reports agency"). The Dow Jones Industrial Average rose 37.83 points, or 0.11%, to 33,241.76, the S&P 500 lost 15.56 points, or 0.40%, to 3,829.26 and the Nasdaq Composite dropped 144.64 points, or 1.38%, to 10,353.23. Markets in some regions including London, Dublin, [Hong Kong](https://www.financedigest.com/hong-kong-finance-official-to-make-first-visit-to-britain-in-three-years.html "Hong Kong finance official to make first visit to Britain in three years") and Australia remained shut after the Christmas holiday. MSCI’s gauge of stocks [across the globe](https://www.financedigest.com/sales-of-medical-beds-across-the-globe-are-estimated-to-exceed-us-3000-mn-in-revenues-by-2022-end.html "Sales of Medical Beds Across the Globe are Estimated to Exceed US$ 3,000 Mn in Revenues by 2022-end") shed 0.15% and was down 19.8% year-to-date. While Cetera’s Goldman said China’s changing COVID [policies would be “good news for the global economy down the road,” he noted renewed caution among people in China](https://www.financedigest.com/dutch-responds-to-us-china-policy-with-a-plan-to-curb-semiconductor-tech-exports.html "Dutch responds to US China policy with a plan to curb semiconductor tech exports") due to the current uptick in COVID infections since China eased restrictions. Benchmark 10-year notes were up 10.7 basis points at 3.854%, from 3.747% late on Friday. The 30-year [bond was last up 12 basis points to yield](https://www.financedigest.com/stocks-up-bond-yields-fall-as-markets-mull-a-fed-policy-pause.html "Stocks up, bond yields fall as markets mull a Fed policy pause") 3.9417%, from 3.822%. The 2-year note was last was up 6.6 basis points to yield 4.3891%, from 4.323%. The dollar was roughly flat on Tuesday as [investors digested China’s](https://www.financedigest.com/oil-steadies-after-dipping-on-china-outlook-investors-await-fed-clues.html "Oil steadies after dipping on China outlook; investors await Fed clues") news. The dollar index, which measures the greenback against a [basket of major currencies](https://www.financedigest.com/the-yuan-makes-its-official-entry-into-rawbanks-currency-basket.html "The yuan makes its official entry into RAWBANK’s currency basket"), rose 0.086%, with the euro up 0.04% at $1.0639. The [Japanese yen](https://www.financedigest.com/japanese-yen-gains-as-ueda-set-to-be-named-next-boj-governor.html "Japanese yen gains as Ueda set to be named next BOJ governor") weakened 0.49% versus the greenback at 133.54 per dollar, while Sterling was last trading at $1.2026, down 0.28% on the day. We’ve been in a very narrow trading range, and I think withthe [dollar firming up against the euro and yen, we could seefurther dollar gains](https://www.financedigest.com/stocks-mixed-dollar-gains-after-robust-inflation-jobs-data.html "Stocks mixed, dollar gains after robust inflation, jobs data") against the Chinese currency,” said MarcChandler, chief market strategist at Bannockburn Global Forex. In [energy futures](https://www.financedigest.com/the-future-of-finance-in-the-energy-industry.html "The future of finance in the energy industry"), U.S. crude settled down 0.04% at $79.53 per barrel and Brent ended at $84.33, up 0.49% on the day. Gold [prices jumped to their highest level in six months on Tuesday with traders optimistic about top](https://www.financedigest.com/4-for-the-price-of-1-what-you-can-buy-in-the-uks-top-northern-cities-for-the-price-of-a-london-pad.html "4 for the price of 1: What you can buy in the UK’s top northern cities for the price of a London pad") consumer China’s decision to further ease COVID-19 restrictions. Spot gold added 0.8% to $1,812.58 an ounce. U.S. [gold futures gained](https://www.financedigest.com/global-equities-gain-as-rising-bond-yields-pressure-gold.html "Global equities gain, as rising bond yields pressure gold") 1.12% to $1,816.00 an ounce. (Reporting by Sinéad Carew in New York, Nell Mackenzie in London; Additional reporting by Xie Yu and Ankur Banerjee; Editing by Simon Cameron-Moore and Matthew Lewis) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---