Emerging markets ruled the charts again in April, according to Morningstar Canada's latest preliminary equity fund index performance data, although strong gains were seen in most equity fund categories in the month.

The report said all but one of the 23 indices showed positive returns in April, with 10 of the indices gaining four per cent or more, following the volatility of the first quarter which saw many of the indices in the red.

Morningstar's Emerging Markets Equity Fund Index gained six per cent in April, leading the 23 fund indices, as the Brazilian and Hong Kong markets benefited from the surge in commodity prices. Brazil's BOVESPA index jumped 11.3 per cent in April, while Hong Kong's Hang Seng index returned 12.7 per cent to investors, the report said.

"Brazil is being seen as the perfect way to play the commodity boom," said Morningstar Canada fund analyst Bhavna Hinduja in a statement. "Brazilian companies like Vale and Petrobras have become increasingly important internationally. And the recent upgrade in the country's credit rating further buoyed positive sentiment about the nation's economy."

The Canadian Equity Fund Index also performed well last month, giving investors the second-best return with a 5.4-per-cent gain, the best monthly return for the category since December 2005.

"Canadian equity markets were boosted by the energy sector as oil prices reached new records due to worries over supply disruptions from major producers and OPEC (the Organization of Petroleum Exporting Countries)'s announcement that it wasn't considering raising output to curb prices," said Ms. Hinduja.

The only equity index to see negative returns was the Precious Metals Equity index, which lost 10.7 per cent as gold prices tumbled five per cent because of the appreciation of the U.S. dollar.