Investors are making a mockery of the saying ‘sell in May and go away’, after the ASX200 notched a record closing high and the All Ordinaries claimed a record high.
A broad rally of more than one per cent helped the ASX beat both records, which had stood since May 10.
The benchmark S&P/ASX200 index closed up by 84.6 points, or 1.19 per cent, to 7179.5 on Friday.
The index came within 11 points of its all-time peak.
The All Ordinaries closed higher by 80 points, or 1.09 per cent, to 7424.
The index set a record intra-day high of 7431.4.
The market is ahead by 2.19 per cent for May with one trading day remaining.
The gain is set to be the second best of the past six months after investors overcame concerns about inflation and rate rises.
Bell Direct market analyst Jessica Amir said the old adage about May did not ring true this time.
“If you sell in May you would be shooting yourself in the foot,” she said.
The market dipped mid-month after US Treasury Secretary Janet Yellen suggested rates may need to rise to temper a surging economy.
A spike in US inflation also worried investors.
However many saw opportunity later.
“We’ve seen investors buy the dip in a big way because inflation concerns have abated,” Ms Amir said.
Technology stocks have lost nine per cent this month due to inflation worries.
Ms Amir said they would recover.
She said the technology losses showed it was better to be a long term investor.
Ms Amir said some technology stocks remained cheap.
“There is still a lot of low-hanging fruit in the tech space,” she said.
“I’d be buying with a long-term view.”
Investors buying on Friday may have been encouraged by US economic data.
Jobless claims fell to a pandemic low and the economy grew at a solid rate of 6.4 per cent during the first quarter.
On the ASX, materials shares were best and rose 1.88 per cent.
Iron ore prices rose overnight and helped the big miners.
BHP gained 2.91 per cent to $48.16, while Rio Tinto rose 2.63 per cent to $123.02.
Fortescue shed earlier gains after revealing the costs had increased for its Iron Bridge magnetite project in Western Australia.
The miner also extended the time to reach full production.
Shares closed lower by 0.67 per cent to $22.12.
Oil prices rose after the positive US data and detail about possible oil supply from Iran.
OANDA analyst Edward Moya said investors learned that if an Iranian nuclear deal is revived, economic sanctions will not be removed immediately.
This would prevent the oil market being flooded with supply.
Santos and Origin gained more than two per cent.
Victoria recorded four local coronavirus infections on the first day of its seven-day lockdown, taking the Melbourne cluster to 30 infections.
Tabcorp revealed a third suitor for its wagering and Sky racing business – BetMakers Technology Group.
BetMakers pitched a $4 million bid including $1 billion cash and $3 billion in new BetMakers shares.
The offer trumps those of UK-based Entain and investment group Apollo Management.
Shares in Tabcorp were higher by 2.17 per cent to $5.17.
Shares in BetMakers were down by 16.25 per cent to $1.34.
The big four banks all gained more than one per cent.
Next week, the Reserve Bank will decide whether to change the record low cash rate of 0.1 per cent.
HSBC Australia chief economist Paul Bloxham expected no change. Inflation is well below target.
On Wednesday, gross domestic product figures for the March quarter are due.
NAB analysts tipped a 0.7 per cent rise, less than the previous two quarters.
The Australian dollar was buying 77.16 US cents at 1722 AEST, lower from 77.45 US cents at Thursday’s close.