Strong gains overseas also helped boost confidence locally.
The benchmark index was trading 0.86 per cent higher at 1028 AEST, thanks to gains in Rio Tinto, Woodside Petroleum and BHP Billiton, with iron ore prices up nearly nine per cent over the past week.
In the US, the Dow Jones Industrial Average closed 0.94 per cent higher and Nasdaq rose 0.8 per cent. The UK’s FTSE 100 closed up 0.68 per cent, while Japan’s Nikkei rose 1.13 per cent.
The local banking sector is also benefiting from higher iron ore prices, given concerns about their exposure to the mining and energy sectors, CommSec market analyst Juliana Roadley said.
“That’s taken away some concern that the banks will have to put aside more cash for bad and doubtful debts,” she added.
While the International Monetary Fund cut slightly its forecasts for 2016 and 2017, it’s still higher than most of the other analysts in the market and also central banks.
“So, that was seen as a positive and that’s just flowed through to our market today.
“I think we do have to be a bit weary about the gains in the banks though because we do have JPMorgan, Citi, and Wells Fargo coming out with results in the next two days.”
Rio Tinto shares were up $1.60 to $46.93, with BHP Billiton up 67 cents to $17.57.
Commonwealth Bank was up 45 cents at $72.67, National Australia Bank added 27 cents to $25.83, Westpac gained 26 cents to $29.39, and ANZ rose 22.5 cents to $23.06.
Investment bank Macquarie Group also found support among investors, up 94 cents to $63.80.
KEY FACTS:
* At 1028 AEST, the benchmark S&P/ASX200 index was up 43 points, or 0.86 per cent, at 5,018.6 points.
* The broader All Ordinaries index was up 42 points, or 0.83 per cent, at 5,095.7 points.
* The June share price index futures contract was up 48 points at 4,999 points, with 10,464 contracts traded.
* National turnover was 32.8 million securities traded, worth $83.9 million.
AAP
