Investors have continued the buying spree on banks stocks from the previous session, pushing the main Australian sharemarket index more than two per cent higher.
The S&P/ASX200 benchmark index was up by 137.3 points, or 2.38 per cent, at 5912.3 points at 1200 AEST on Thursday.
The All Ordinaries index was 135.4 points, or 2.30 per cent higher, at 6020.3.
The gains were mainly led by financial sector, up 4.6 per cent. The enthusiasm for banks follows the reopening of the economy and was bolstered by a UBS report this week which flagged a catch-up rally on bank stocks.
Market sentiment was also helped by Reserve Bank Governor Philip Lowe who told a Senate inquiry on Thursday that the economic downturn from coronavirus may not be as severe as predicted.
Australia’s recovery largely depended on when the public regains its confidence in their health and finances, Mr Lowe said.
Among the major banks ANZ was up 6.6 per cent at $19.12, NAB rose 6.35 per cent to $19.08, Westpac rose 5.28 per cent to $18.54 while Commonwealth Bank climbed 4.07 per cent to $66.91.
Shares in regional lender Bendigo Bank also jumped 7.8 per cent to $6.78 despite the bank saying it had made an extra provision of $148.3 million for potential impacts of the COVID-19 pandemic on its customers.
The big miners recorded decent gains with BHP, RIO Tinto and Fortescue all up between 2.0 to 3.0 per cent.
The only sector struggling to stay positive was energy. Santos and Woodside were down by less than 1.0 per cent, while Oil Search was flat.
Origin was a bright spot, up 2.14 per cent to $5.95. The positive mood in the local market follows strong overnight gains in the US markets, with the banking sector one of the main beneficiaries.
One Australian dollar was buying 66.30 US cents at 1200 AEST, down from 66.44 US cents at the close of trade on Wednesday.