The yield on the benchmark 10-year Treasury note dropped the most in six months on Thursday as anxieties of global trade dispute spurred a market sell-off.

The 10-year Treasury yield fell more than 8 basis points to 2.82 percent, its biggest one-day decline since September of last year. It dropped as low as 2.79 percent at one point. Bond yields move inversely to prices.

It was quite a violent turnaround from Wednesday's high of 2.93 percent which came shortly after the Federal Reserve's decision to raise interest rates.

The Dow Jones industrial average fell more than 700 points Thursday amid growing trade tensions. Declines of more than 5 percent in shares of both Boeing and Caterpillar — both of which could be hurt by a slowdown in the global economy — dragged on the blue-chip index.

Source: Factset

The slump in Treasury yields came as trade wars fear peaked, with President Donald Trump signing an executive memorandum imposing retaliatory tariffs on up to $60 billion in Chinese imports.

"This bid is coming from the potential for a trade war and tariffs directed at China," said Kevin Giddis, head of fixed income capital markets at Raymond James. "The early trade this morning was mostly short covering, but then it manifested itself into a safe haven bid."

Additional trade penalties against China would just weeks after President Donald Trump signed two proclamations that implemented tariffs on imported steel and aluminum.