The Australian share market has risen by more than two per cent, breaking a six-day losing streak as investors snapped up bargains.
CMC Markets chief market strategist Michael McCarthy said investors were buoyed by positive leads from markets overseas and a lift in the price of oil.
And after a prolonged period of selling, the local bourse had been set for a bounce back.
Investors picked up beaten-down stocks, led by the big resources stocks that have been pummelled in the wake of low prices for commodities such as iron ore and oil.
“We’re seeing investors saying here’s my signal to pick up those bargains I’ve been keeping an eye on,” Mr McCarthy said on Wednesday.
He said investors were keenly awaiting the US Federal Reserve’s decision on interest rates Thursday morning local time.
The Fed is widely expected to raise its interest rate for the first time in almost 10 years.
Mr McCarthy said the possible event with the most potential to disrupt the market now would be no change in the US interest rate.
In the resources sector, global miner BHP Billiton surged 91 cents, or 5.59 per cent, to $17.18, Rio Tinto advanced $1.26 to $43.02, and Fortescue Metals gained 9.5 cents at $1.90.
Among the major banks, ANZ added 68 cents at $26.01, Commonwealth Bank ascended $2.22 to $79.09, National Australia Bank strengthened 72 cents to $28.38, and Westpac put on 86 cents at $31.46.
But in the healthcare sector, pathology operators Sonic Healthcare slumped $1.04, or 5.62 per cent, to $17.46, and Primary Health Care sagged 25 cents, or 9.69 per cent, at $2.33.
The federal government’s mid-year budget update released on Tuesday unveiled a plan to remove bulk-billing incentives for pathology services and reduce incentives for magnetic resonance imaging services.
Among other stocks, casino operator Crown Resorts soared $1.12, or 10.52 per cent, to $11.77 on reports that billionaire James Packer wants to return some of Crown’s assets to private ownership.
KEY FACTS:
* At 1622 AEDT on Wednesday, the benchmark S&P/ASX200 index was up 118.8 points, or 2.42 per cent, at 5,028.4 points.
* The broader All Ordinaries index was up 114.8 points, or 2.31 per cent, at 5,078.7 points.
* On the ASX 24, the December share price index futures contract was up 123 points at 5,027 points, with 104,546 contracts traded.
* National turnover was 2.4 billion securities traded worth $6.5 billion.
