correction on the cards

I have been looking at the chinese steel producers which I believe is the benchmark of the Chinese economy. There was a rise last month in the share price and I was staggered.
Some of the largest steel producers in China have pe ratios of 29, this is way overheated, this level of pe ratio exists even after a 30% fall in stock price over 3 months.

I actually think that we have a reverse diagnosis of economic confidence occuring in china. This time instead of world economies having too much confidence in China; China has put too much confidence in world demand which has resulted in overheated stocks.

I think Australian stocks could correct between 15 to 20%, depending on the sector, the down side will be moddest.