Stock futures were bolstered by stronger Chinese economic data, which boosted investor optimism even on the day that General Motors filed for bankruptcy protection.
Data showing a fall in consumer spending in April was also bearish for bonds, with expectations the U.S. government will have to issue even more debt to stimulate the economy.
"It's a rebalancing into stocks from bonds," said T.J. Marta, chief market strategist at Marta on the Markets in Scotch Plains, N.J.
Benchmark 10-year Treasury notes fell over a full point in price. The notes were trading 1-8/32 lower in price for a yield of 3.62 percent, up from 3.47 percent late Friday, while the 30-year bond was 2-10/32 lower for a yield of 4.48 percent from 4.35 percent.
The Commerce Department said U.S. consumer spending fell 0.1 percent in April after a revised 0.3 percent fall in March, even through personal income rose by the most in 11 months.
"The consumer doesn't seem convinced that it's an ongoing benefit with the income increase. After careful consideration, the consumer is retrenching with the decline in spending. That means the government has to stimulate the economy more," Marta said.
Investors are now looking to April construction spending and May manufacturing data later Monday morning.
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