ATLAS ENERGY RESOURCES (ATN)
MAKES A BIG PURCHASE

Not often we get a deal on Sunday night but we have one as Atlas Energy Resources (ATN) is buying 1 billion in assests...doing a private placement of equity and promising a big distribution increase for 2008! The distribution now is 1.72 and they are forecasting a rise of 2.20 to 2.40 per unit so at a 5% yield at $2.20 annual the stock prices should get into the 40s by next year.


Looks like a Monday morning big mover! Although one has to wonder whether word began leaking out on Friday since the stock closed up 1 ahead of the weekend.

And with a new week beginning i think we need to look at what is going on with MLPs as compared to the 10 year. We haven't been paying much attention to this in the last few months since the group has been on a bull tear and rates have done nothing. But notice that last week's sell off is co-inciding with a move up in the 10 year yield and that chart is looking to move higher toward the 4.90 area.

Now as long as 4.90 holds the correction in MLPS should remain contained to the moving average support lines. We're almost there on the 34 day at 326.44 and 320 and 312 loom right below there. But if 4.90% gets taken out and we are suddenly facing a move back to 5% or 5.25% we could be in for a serious pullback...perhaps to the 300 level as that is where the 34 week moving average sits on the weekly chart.

Note that the upmove in rates if it is real may be a reason to set off a broader market correction which is being forever predicted but never happening. Eventually broken clocks are right twice a day.

No other corporate developements this morning and no upgrades or downgrades at least so far.