There are four charts in Betashare chief economist, David Bassanese’s monthly market report released on Tuesday which reinforce the idea that Australian stocks are fully valued and times ahead could be tougher than the two years just passed.
Bassanese is not exactly negative on the outlook but he does highlight the challenges ahead and, like RBA Governor Glenn Stevens recently, appears to believe it is low rates in Australia and abroad that are the primary prop to stocks.
While valuations are not especially cheap and earnings are under pressure the market’s dividend yield still remains attractive in a low interest-rate environment…One risk is a major back up in bond yields as the US Federal Reserve inches closer to raising official interest rates
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