If you are in the market for speculative stock, Perth-based brokerage house recommends Pancontinental Oil & Gas, Sun Resources and Kimberley Oil.

Pancontinental and Sun surged last week on news of a controlled gas kick at 347m at the Waingaromia-2 well, now drilling on NZ's east coast. "The strong move highlight the effects that a sniff of hydrocarbons have on a small explorers," Carmichael said in its weekly report.

As for Kimberley Oil, Carmichael said the company owns 100% of the Blina Sundowner area, which is said to contain over 500 million barrels of oil in place. If Kimberley's July workover program is successful then the company would be able to fund exploration work out of cashflow, according to Carmichael.

"We believe Kimberley Oil offers significant upside from current levels," Carmichael said.

With two contract wins in Thailand and Mongolia valued at $126 million, Carmichael said it believes Perth-based engineering group Clough is trading at lows for the year and will represents an excellent buying opportunity in the low 80's during June for a recovery in July/August back towards $1 per share.

"Buy Clough during June below 84 cents per share," Carmichael said.