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Tuesday, April 03, 2012


The first quarter is over and done with and we have seen some great moves in the overall market led by the nasdaq which jumped 18% in q1! MLPS however lagged far behind for the first time in a long time. While the index did hit 410 which is a new high it closed the quarter virtually unchanged. Building tops are a process while bottoms are usually events. And right now it seems that mlps as a group will take a back seat to the rest of the market.

The big movers down over the last few weeks have been the coal mlps which were hit hard by an EPA ruling which will make it harder to start up new coal plants.
Alliance Resource Partners (ARLP) was one of the groups star performers for a long time but after hitting the lower 80s it has sunk below 60 and alot of that came last week with an end of quarter blow out. The stock is down 1 to 57 this morning and this chart has stay away written all over it at least for now. Some are even questioning whether the company can grow its distributions under this regulatory enviornment of this administration.
Natural Resource Partners (NRP) above and Penn Virginia Resources (PVR) below are 2 others that are suffering with the coal group. For now there is no indication of distribution trouble but quarterly reports will be due out in the next few weeks so it will be interesting to see if companies have anything to say about it and what, if any impact this will have down the road. Remember folks its about growing payouts. For now im staying away from the coal mlps until the situation becomes clearer or at least a bit less muddied.

This morning the index is up a fraction and holding above 390. Overall the market is down a little today after the buy rush from the last few days. Nat gas has even stopped going down for now as 2 dollars appears to be holding. The 10 year is at 2.16% and crude is near the top of its recent range on Brent at 125 but West Texas is near 104.

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