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Miners have bounced back from a troubling Tuesday to forge a broad-based rally on the Australian share market, following renewed hope of economic stimulus in the US.

The S&P/ASX200 benchmark index closed higher by 47.9 points, or 0.72 per cent, to 6679.2 on Wednesday.

The rise was the index’s biggest gain since December 1.

The All Ordinaries closed higher by 50 points, or 0.73 per cent, to 6916.7.

The materials sector had the most notable rise, 1.77 per cent. The sector fell 1.74 per cent on Tuesday after China banned Australian coal.

Investors followed the lead from the US, where markets closed higher as optimism increased for a government $US1.4 ($1.9) trillion spending package to help an economy ravaged by COVID-19.

The US Federal Reserve is also expected to signal low-interest rates for the foreseeable future in its two-day meeting this week.

The Aussie dollar was buying 75.58 US cents at 1619 AEDT, higher from 75.15 US cents at Tuesday’s close.