The Australian share market is higher as investors return to high yield stocks, including the major banks.

CMC Markets chief market analyst Ric Spooner said stocks were also supported by comments from US Federal Reserve chair Janet Yellen that the Federal Funds Rate will be raised later this year, adding that the rises will be gradual.

“She made it clear that she thought the Fed would be very gradual in lifting rates and that it may be years before the Fed rate returns to historical long run averages,” he said.

“Investors are now focusing on the fact that it might be a risky strategy to get out of risk assets just because there’s going to be a rate hike or two.

“As a consequence we are seeing support for the yield stocks today with the banks, Telstra, Woolworths and Wesfarmers all higher.”

Among the banks, Commonwealth Bank climbed 87 cents to $83.98, ANZ gained 39 cents to $32.44, Westpac rose 35.5 cents to $32.915, while National Australia Bank was up 15 cents at $33.38.

Coles’ parent company Wesfarmers added 67 cents to $44.00, while Woolworths had gained 39 cents to $28.57.

Telstra was up 6.5 cents to $6.265.

The major miners were also higher following a sharp rise in iron ore prices on Friday.

Rio Tinto was up 79 cents to $57.54, BHP Billiton was 30 cents higher at $29.55 and Fortescue Metals added 7.5 cents to $2.185.

Meanwhile, shares in workforce provider Skilled Group were up 15.25 cents, or 12.4 per cent, to $1.38 after it announced it had entered merger talks with rival Programmed.

KEY FACTS

* The benchmark S&P/ASX200 index was up 62.7 points, or 1.11 per cent, to 5,727.4 points.

* The broader All Ordinaries index up 58.6 points, or 1.03 per cent, to 5,726.8 points.

* The June share price index futures contract was 54 points higher at 5,736 points, with 9,399 contracts traded.

* National turnover was 682 million securities worth $1.15 billion.