ASX shares seem to be in a bull market. What should investors do? The S&P/ASX 200 Index (ASX: XJO) is up another 1% today, it's back to 6,000 points.
The ASX 200 has risen 32% since 23 March 2020. An incredible run in such a short amount of time. If you're just thinking ahead to 2030 and beyond then today is probably still a good time to buy shares because plenty of ASX shares are still not back to their February 2020 highs.
The coronavirus is still spreading around the world, particularly in the US and emerging markets like Brazil. ASX shares like BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) are benefiting from the tough conditions mining environment in South America.
ASX bank shares like Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) are flying higher. The buy now, pay later sector is going nuts – the share prices of Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P), Splitit Ltd (ASX: SPT) and Sezzle Inc (ASX: SZL) are soaring.
Australia certainly has done a better job at managing the spread of the infection as well as limiting the worst of the potential economic damage.
But should ASX share investors keep buying or remain patient?
Some investors may have a regular investment plan into an exchange-traded fund (ETF). If that's the case, I wouldn't worry too much about delaying your next ASX share investment.
But investors trying to pick the right shares should continue to be cautious and considered. The RBA has reduced the official interest rate to a very low level. But that doesn't mean businesses are out of the woods yet. Some businesses may never be the same again. The unemployment rate is still much higher than before COVID-19.
I've always said that investors should just focus on whether the potential investment is good value (and ignore the rest of the noise). There aren't many obvious bargains like there were before a couple of months ago.
Hoping that everything will turn out fine over the six months is not an investment strategy. ASX shares that generate most of their earnings in Australia and New Zealand seem to have an easier path out of this. But ASX shares that rely on growth of the economies of China and the US may yet see a wobble later this year.
I'm being more careful with my ASX share buying, but I do intend to keep investing for the long-term.
