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July 6, 2012

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Winners & Losers: MLPs Float On

Like the one house (mine) on the block that had everyone asleep and lights out before fireworks started on Wednesday, or like the one person in that house (me) who remained awake to watch the fireworks that were blasting 360 degrees around my house, MLPs refused to go along with the crowd this week.  MLPs were up 2.0% in a week of weak jobs data, lower stocks and lower commodities.  The MLP Index is now technically up 8 straight trading days, including yesterday which was basically flat, up 7.1% during the streak.

Granted MLPs have a ways to go to catch up with stocks for the year, the MLP Index is now positive on a total return basis year to date and is trending in the right direction.  I’m still wary of pending weak earnings, as the pre-announcements are not great (see EEP and NS announcements, both were in the bottom 5 performing MLPs group this week).  But for now, MLPs continue to defy gravity, floating on so to speak…

Winners & Losers
Niska was up the most this week, up 10.7% this week after 12.0% increase last week.  GMLP was also in the top 5 for back to back weeks, up 7.6%.  The few losers this week were led by DPM, as I guess the Euphoria of the drop down and PIPE last week was replaced by NGL heaviness.

Variable distribution MLPs, GPs and stocks are still way out in front of MLPs, but the gap has narrowed significantly of late.   Oil, natural gas and NGLs still ugly year to date.

NKA extended its lead on the sector year to date (+58.7% total return) with another big week, but is just now reaching its price level from last August.  The top 5 and bottom 5 had no changes in membership this week, just rearrangements, after good weeks from all but OXF and ARP.

Expect more equity next week, expect this winning streak to end, but expect continued strength from MLPs as we build towards distributions and earnings announcements in time for the Olympics to start, at which point I can start making some Olympic metaphors, get excited!  Just be thankful there were no hot dog eating contest references this week.

More on the news of the week in my Week Thoughts post to come later this weekend.

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