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Australia Market Due for 5-10% Correction

The Australian market is at fair value and will see a short market correction, but will recover quickly and rise by the year’s end, according to Angus Geddes, CEO of Fat Prophets.

“If we do see a correction, it’s going to be very short, 5-10%,” Geddes told CNBC Tuesday adding that after this correction “the market will resume its upward march towards 5,000 at the end of the year.”

Geddes has an optimistic view heading into 2010 as well because “earnings are going to be much more robust,” and there is “still plenty of cash on the sidelines.”

The market strength is due in part to large inflows coming from international fund managers who were “caught out not just by Australia, but also by the rising dollar,” he added.

- For the full interview, watch the video clip above.

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