AMZ rose 4.0% last week
MLPs’ strong positive momentum continued. The Alerian MLP Index (^AMZ), which includes 44 energy MLPs, ended in the green for five consecutive weeks. AMZ rose 4.0% last week and ended at 285.5—the highest weekly gains in the last seven months. Out of the total 93 MLPs, 55 ended in the green, seven remained unchanged, and 31 ended in the red last week.
Among the top MLPs, Energy Transfer Partners (ETP), Williams Partners (WPZ), and MPLX (MPLX) rose 18.0%, 6.0%, and 3.6%, respectively, while Enterprise Products Partners (EPD) fell 0.5%. The Alerian MLP ETF (AMLP) gained 5.2%
Last week, MLPs’ rally was mainly driven by a positive sentiment after Energy Transfer Partners agreed to merge with Energy Transfer Equity (ETE). The sector got a boost after the FOMC kept the policy rates unchanged.
Will MLPs continue to rally?
Strong earnings announcements, a slight recovery in crude oil prices, and a decline in the US Treasury yield might continue to drive the positive momentum in MLPs during the week.
A dip in US drilling activity and a rise in trade war tensions between the US and China could weigh on MLPs’ performance this week. China proposed tariffs on US liquefied natural gas and crude oil imports last week in retaliation to proposed US tariffs on Chinese goods worth $200 billion.
Next, we’ll discuss the WTI Cushing-WTI Midland spread and how its impacts MLPs.