However, the question to ask today is how much further these stocks might fall. Is the start of a recovery in sight, or should shareholders take a loss and sell?
Is now the time to start buying again?
BP went into the oil downturn with a strong balance sheet and plenty of cash on hand. The firms chief executive, Bob Dudley, has consistently commented that he believes oil prices are likely to stay lower for longer than the market expects. The evidence so far suggests he might be right.
Analysts expect BP to report a net profit of $6.4bn for 2015, falling to $5.0bn in 2016. I think 2016 is likely to be the low point, but its possible the full extent of the financial damage caused by low oil prices wont be felt until 2017.
At todays price of around 365p, I believe BP would probably be a profitable buy over 3-5 years. However, the shares could easily fall further and there is a risk of a dividend cut.
BP is on my watch list, but Im tempted to wait until later this year before deciding whether to buy.
The outlook does seem to be improving for Standard Chartered. Analysts expect 2015 to mark a low point for the banks profits, which are expected to rise from $1.1bn in 2015 to $1.7bn in 2016.
The latest consensus forecasts show earnings per share of $0.68 for 2016, implying a forecast P/E of 9.7. A dividend payout of $0.23 is expected, giving a potential yield of 3.4%.
Another point in Standard Chartereds favour is that it passed the Bank of England stress tests at the end of last year, thanks to the additional capital strength provided by the banks $5.1bn rights issue.
On the other hand, Standard Chartered is heavily exposed to Asian markets and commodities. Theres clearly a risk that bad debt levels will rise significantly. Even if the bank survives, it may not prosper in this market.
Im encouraged by the stronger forecast outlook for next year and rate Standard Chartered as a cautious buy, but I wouldnt bet the house on it.
I rate Chilean copper miner Antofagasta highly because it has two key qualities: low cost mines and net cash.
Antofagastas mines have remained profitable as the price of copper has fallen. The groups latest production report shows that the firm expects to produce copper at a net cash cost of $1.35/lb in 2016. This compares to a market price of around $2.06/lb currently.
Production is expected to rise in 2016 as the groups recently-acquired 50% stake in Barrick Golds Zaldivar mine makes a fuller contribution.
Of course, the market recognises these strengths. Antofagastas shares have always looked expensive.
Despite falling by 44% over the last year, the firms stock still trades on a 2015 forecast P/E of 27 and a 2016 forecast P/E of 29. With profits expected to fall further this year, I feel that the price is still a bit too high but I am watching closely as I believe this could be an attractive recovery buy at some point.
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Roland Head owns shares of Standard Chartered. The Motley Fool UK has no position in any of the shares mentioned. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.