The yields on benchmark Treasury notes headed lower Wednesday as the Commerce Department reported weaker-than-expected new home sales, which dropped by 5.5% during September–its lowest level since 2016.

The 10-year note went down to 3.124, while the 30-year note was at 3.341 as of 12:30 p.m. ET. The 5-year note fell to 2.964 as the 2-year note ticked down to 2.859.

The drop in yields come as volatility is roiling the major U.S. indexes with sell-offs in sectors like technology continuing amid a week of third-quarter earnings reports.

“Anyone watching home builder stocks or watching the data all year should not be surprised but its’s clear this important area of the US economy, highly sensitive to price and rates, has obviously slowed sharply,” said Peter Boockvar, chief investment officer for the Bleakley Advisory Group.

Related: Senior Loan ETFs Bolstered by Solid Economic Numbers

Housing Starts Fall

The new home sales data comes as housing starts also fell more than expected, sliding by 5.3% to a seasonally adjusted annual rate of 1.201 million units last month, according to the Commerce Department. The fall nailed homebuilder ETFs like the iShares US Home Construction ETF (BATS: ITB), SPDR S&P Homebuilders ETF (NYSEArca: XHB) and the Invesco Dynamic Building & Construction ETF (NYSEArca: PKB).

“Contractors are paying more for the materials they use and workers they employ but aren’t able to pass most of those new costs on to their clients,” said Ken Simonson, chief economist for the group, the Associated General Contractors of America.

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