The long-term rate-indicative 10-year Treasury yield plummeted to 4.40% Friday morning following a more gradual downward trend during the week from a previous trading range near 4.65%.The Friday morning move was due to a rise in oil prices and some negative earnings results, according to Yahoo Finance/AP. The notable drop in rate-indicative yields, and the ensuing concern that certain mortgage-backed securities might be exposed to the risk of prepayment and shortened durations, sparked significant hedging of the risk through trades into mortgage assets with lower rates and less risk of refinancing, according to RBS Greenwich Capital MBS analyst Pankaj Jha.
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