First quarter earnings season kicked off in April with mildly encouraging results coming from US companies. The fundamentals of many companies have declined, but not to the extent many experts predicted; the public markets reacted accordingly as the S&P 500 was up modestly for the month of April (0.4%). The developed international country index (MSCI EAFE), which has underperformed both domestic and emerging market indices year-to-date, had a solid 2.9% rebound, while the MSCI emerging market index continued its strong performance with another 0.5% gain. Perhaps the most pleasant surprise was the resurgence of master limited partnerships (MLPs). The Alerian MLP index had an 11% gain for the month and pushed its 2016 performance in to the black. The recovery, in what has been a dismal environment for MLP investors of late, came alongside a recovery in the price of oil. Public perception of MLPs and their connection with the oil industry has caused them to trade almost in tandem. With the rise in oil back above the $40 dollar per barrel level, a combination of short covering and the return of retail investors to the energy infrastructure space propelled MLP investors to have their best monthly performance of 2016.
The discussions and opinions in this market summary are for general information only, and are not intended to provide investment advice. While taken from sources deemed to be accurate, Ballentine Partners makes no representations about the accuracy of the information in the market summary or its appropriateness for any given situation. Past performance of the indices shown is not necessarily indicative of future results.