10-year yield hits lowest level since March as historic oil plunge stokes fears about the economy

Treasury yields fell on Tuesday as a stunning drop in oil prices raised concern about the global economy.

The U.S. 10-year rate fell to 0.55%, hitting its lowest level since March. The 2-year yield traded at 0.189% while the 30-year bond yielded 1.129%. Yields move inversely to prices. 

Tuesday's decline in yields comes after U.S. oil prices tumbled below zero for the first time on record, with crude storage facilities filling rapidly and as the coronavirus crisis ravages demand.

West Texas Intermediate crude futures for May settled at negative $37.63 a barrel on Monday, closing in negative territory for the first time in history. 

"The historic drop by front month oil futures was largely due to logistical issues in the physical market, namely lack of available storage, paired with futures expiration looming today. But the major underlying problem for the energy markets lies with demand," wrote Tom Essaye, founder of The Sevens Report. 

The June contract for WTI, which is more actively traded, stood at $15.79 a barrel, down 22%.

U.S. stocks followed yields and oil prices lower. Dow Jones Industrial Average futures were down more than 2% while S&P 500 and Nasdaq 100 futures slid 1.9% and 1%, respectively. 

The U.S. Treasury is set to auction $28 billion in 52-week bills and $25 billion in 119-day bills on Tuesday.

—CNBC's Sam Meredith contributed to this report.