On the back of Friday’s plunge in oil, revisiting some of the more closely followed, locally listed oil related equities may be worthwhile, if looking for trading opportunities this week. Keppel Corp stands out as one of the more vulnerable names for a retest of the December lows of around S$7.91. Not only have they rebounded the most (when compared to our sample names below), fresh news over a huge turnout at a political protest in Brazil could also lead to a reassessment of Keppel Corp’s close association to their key clients in Brazil, who are themselves embroiled in a corruption scandal. Sembcorp Marine, with their exposure to similar clients there, may also see selling pressure going forward. So far in the year to date, neither Keppel nor Sembawang have been successful in booking new orders with any significance or size. Furthermore, the current orders they have on hand may also prove vulnerable to cancellations due to the bleak outlook for oil. Both Ezion and Erza have lost back almost their entire January rally and are languishing near their December lows.
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