Australia’s share market was trading about 1.6 per cent higher as news Australia’s economy shrunk more than expected in the June quarter did little to deter investors.

The S&P/ASX200 benchmark index was higher by 96.8 points, or 1.62 per cent, to 6050.2 points at 1200 AEST on Tuesday.

The All Ordinaries index was up by 97.3 points, or 1.58 per cent, to 6240.5.

Most attention this morning has been on the release of the national accounts for the June quarter.

They showed a 7.0 per cent contraction in the economy and confirmed the first recession in almost 30 years.

Economists had tipped a 6.0 per cent drop.

The Aussie dollar fell from 73.62 US cents to 73.37 US cents in the wake of the news.

The Australian dollar had recovered to 73.47 US cents by 1200 AEST.

Meanwhile a six-month extension to the Victorian government’s state of emergency powers passed parliament overnight.

The current state of emergency was due to expire on September 13, along with Melbourne’s stage four lockdown and regional Victoria’s stage three rules.

The state government on Sunday will release plans to ease restrictions for people Melbourne and regional Victoria.

On the market, the materials sector was booming by 2.43 per cent.

BHP had a 3.49 per cent gain to $38.81, Rio rose by 2.54 per cent to $99.96 and Fortescue climbed 3.97 per cent to $18.32.

BlueScope Steel had a 6.26 per cent bounce to $13.23.

There were gains of more than 2.0 per cent for consumer staples and utilities.

Higher by more than 1.0 per cent were financials, telecommunications, property, industrials, health and consumer discretionaries.

Among the big banks, ANZ rose by 0.9 per cent to $17.93, the Commonwealth was up by 1.33 per cent to $67.68, NAB was steady at $17.40 while Westpac climbed 0.99 per cent to $17.22.

Shares in AMP were higher by 6.0 per cent to $1.63 after it revealed unsolicited expressions of interest have been made for its assets and businesses.

The AMP board will review the group to assess opportunities.

The ASX’s steady climb follows the US S&P 500 and Nasdaq posting record closing highs after economic data and moves toward stimulus talks in Washington helped fuel optimism.

Apple and Zoom Video soared and helped pull the market higher, while US Treasury Secretary Steven Mnuchin said he would telephone House Speaker Nancy Pelosi about stalled coronavirus aid negotiations.

The Dow Jones index also finished higher.