Bargain hunters scour share market

The Australian share market has fallen 16 per cent over the last two and a half months but some say there are now good deals to be had. The S&P/ASX 200 Index was at 5747.3 at close of trading on Friday which puts the price-to-earnings ratio of local shares at 13 times compared with an average over the past decade of 15.7 times. CommSec Economics has said that a price-to-earnings ratio between 13 and 13.5 usually indicates a sharp share market rally and that some stocks have been oversold. However analysts also caution that just because the market seems to have reached a temporary bottom it does not mean that all stock are cheap enough to warrant wholesale purchasing, and that pockets of value need to be identified.

By The Australian Financial Review

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