The Australian share market was higher at noon as traders decided they had over-reacted to Europe’s debt problems on Monday and recovered some of their losses.

Offshore markets in Europe and US posted losses overnight but to a far smaller degree than the 2.05 per cent ASX drop that represented the heaviest one-day fall for the year.

The fears related to Mediterranean island Cyprus proposing to impose a deposit tax as part of bailout plans that raised worries there would be a run on banks and the idea would spread to other countries.

CMC Markets chief market analyst Ric Spooner said with the benefit of hindsight the market had overshot.

“It’s not really a robust bounce I don’t think, we’re certainly still well below where we were Friday,” Mr Spooner told AAP.

“That reflects the fact that there is ongoing risk, particularly the next hurdle which will be the vote by Cypriot parliament on whether to approve these measures.”

The gains in Australia were broad-based with all sectors up apart from defensive healthcare stocks.

Among the big miners BHP Billiton was 29 cents up to $34.98 and Rio Tinto had gained 25 cents to $59.80.

Fortescue was the strongest performer among the top 50 companies, having shot up 13 cents, or 3.3 per cent, to $4.02 after being punished in recent weeks.

The banks were also higher, with National Australia Bank up 46 cents to $30.95, Westpac improving 37 cents to $30.34, Commonwealth adding 90 cents to $70.12 and ANZ is 21 cents higher at at $28.29.

KEY FACTS

* At 1204 AEDT on Tuesday, the benchmark S&P/ASX200 index was 37.5 points, or 0.75 per cent, up at 5,052.9.

* The broader All Ordinaries index was 37.9 points, or 0.75 per cent, stronger at 5,065.3.

* The March share price index futures contract was 48 points better at 5,054, with 116,871 contracts traded.

* National turnover was 856.5 million securities worth $1.44 billion.