Watling: Australia is an overvalued share market

The Australian reporting season is in full swing and as usual, two sectors investors have been watching closely are Resources and Financials. Chris Watling, CEO, Longview Economics thinks the market as a whole, based on relative PE to the US, is ‘about as expensive as it has ever been’. Chris believes this is occurring principally because of Telstra and the big 4 Australian banks. In this video Watling also argues that after four years, the commodity bear market is quite ‘mature’ and share prices linked to commodity prices have come ‘an awful long way’. He suggests that over the next 12 months, as capacity inevitably comes out of that market, investors will be presented with an interesting buying opportunity.