Weakness in oil prices and energy stocks dragged midstream stocks down in a flattish broad equity market week. MLPs outperformed corporations this week, and they remain well ahead of them for the year so far. Over the last 12 months, the MLP Index is more than 10% ahead of the broader AMNA, with Canadian midstream lagging substantially. Utilities outperformed and infrastructure kept pace with the market, while interest rates drifted higher.
The market is still focused on the pace of slowing inflation, and oil prices were hurt by a bad oil inventory report. But it wasn’t just the macro that sunk energy stocks this week, it was the micro of weaker earnings releases and guidance releases from E&P companies. Midstream came under pressure as well, especially big corporations that are more closely associated with energy stocks in major indexes.