By Sam Goldfarb 

Government-bond prices rose in the U.S. and Europe after new data added to concerns about the eurozone economy.

The yield on the benchmark 10-year U.S. Treasury note settled at 2.563% Thursday, compared with 2.592% Wednesday.

Yields, which fall when bond prices rise, dropped overnight after IHS Markit said its composite Purchasing Managers Index, a measure of activity in the manufacturing and services sector, fell to 51.3 in April from 51.6 in March. That was below the consensus forecast of a 51.6 reading, as the PMI for the manufacturing sector pointed to a decline in activity for the third straight month.

While Treasury yields fell after the release, declines were more pronounced in Europe, with the 10-year German bond dropping to 0.021% from 0.085% Wednesday, according to Tradeweb.

The impact of the eurozone data was enough to overwhelm that of an encouraging report on U.S. retail sales, which analysts said presented the latest evidence that the U.S. economy is performing better than some had feared heading into the year.

In recent weeks, Treasury yields have been buoyed by better data out of the U.S. and China. Still, yields remain far from the multiyear highs reached last fall, given continued worries about the global economy, muted U.S. inflation, and a widespread belief among investors that the Federal Reserve is more likely to lower interest rates this year than it is to raise them.

Even before Thursday's data release, demand for Treasurys had picked up modestly after the 10-year yield briefly rose above 2.6% early in Wednesday's session.

Once yields reached that level, some investors started thinking that the recent selloff was a "little bit overdone just given where Fed expectations are and where global yields are," said Justin Lederer, senior trader of interest rates at Cantor Fitzgerald LP.

Write to Sam Goldfarb at sam.goldfarb@wsj.com

(END) Dow Jones Newswires

April 18, 2019 16:37 ET (20:37 GMT)