The ASX’s All Ordinaries (XAO) has jumped to a 11-year high as the market responded to the weekend’s Federal Election result.
The All Ordinaries was established in 1980 and is the oldest index of shares in Australia. It is made up of the share prices for 500 of the largest businesses listed on the Australian Securities Exchange (ASX).
Why The All Ords Is Jumping
The ASX had already been reaching multi year highs on expectations that the Reserve Bank of Australia (RBA) is likely to reduce interest rates to try to support the economy in light of Australia’s slowly rising unemployment rate and falling house prices.
However, a strong performance from the resources sector including BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) has seen the ASX almost recover to its former all-time highs.
Today’s reaction is mostly going to ASX shares that pay large fully franked dividends like Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB).
However, the housing sector is also getting a large boost right now. The Boral Limited (ASX: BLD) share price is up 5.1%, the Wagners Holding Company Ltd (ASX: WGN) share price is up 6.6%, the CSR Limited (ASX: CSR) share price is up 2.75%, the JB Hi-Fi Limited (ASX: JBH) share price is up 2.5% and the Beacon Lighting Group Ltd (ASX: BLX) share price is up 3.3%.
Should You Buy?
If you have a regular investing policy of buying an ETF like Vanguard Australian Share ETF (ASX: VAS) every month then I wouldn’t change that strategy, but I can understand if you’re hesitant about buying at high valuations.
My strategy has always been to buy ASX shares when they’re good value, so quite a few of the ones I’ve mentioned above are not as good value.
One of the shares I’m thinking about investing in is one of the proven and reliable ASX shares in the free report below.
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