U.S. government debt yields rose on Thursday as investors sold safer Treasurys in favor of riskier assets like stocks following the release of strong economic data.
Rates rose after the Commerce Department said housing starts rose by 5.7% in April to a seasonally adjusted annual rate of 1.235 million. Economists polled by Refinitiv expected housing starts to rise by 1.205 million.
Weekly jobless claims, meanwhile, fell to 212,000 last week. Economists expected claims to fall to 220,000 from 228,000.
The strong economic data helped quell some of the fears surrounding the ongoing U.S.-China trade war. Also easing trade angst are the Trump administration's plans to delay auto tariffs by up to six months. The planned delay appeared to help calm markets that had feared Trump would anger the European Union and Japan.
The European Union, for example, has already prepared a list of retaliatory duties to implement if Trump targets autos.
"The safe haven trade is being reversed a bit after the President announced that some of the tariffs wouldn't go into effect for certain goods," Kevin Giddis, head of fixed income capital markets at Raymond James, wrote in a note. "This gave rise to a selling of flight-to-quality assets, and the more orderly reinvestment into riskier assets."
On Wednesday, the U.S. Department of Commerce announced the addition of Huawei Technologies and its affiliates to the Bureau of Industry and Security (BIS) Entity List, making it more difficult for the Chinese telecom giant to conduct business with U.S. companies.
—CNBC's Fred Imbert contributed to this report.