The Australian share market has closed one per cent higher, boosted mostly by the big four banks.
IG market strategist Stan Shamu said the banks had underperformed over the last few weeks and were now attracting bargain-hunters.
Also, investors were looking for good income streams from the banks’ dividends, especially as a new financial year approaches.
Reports that American billionaire investor Warren Buffett may consider an investment in one or more of the big four banks had also given the stocks a boost.
Mr Shamu said energy stocks and other high-yielding stocks such as Telstra also made gains.
“But everything else really is not convincing. The unfortunate thing is our market is really skewed towards the big banks and the other big yield plays like Telstra,” Mr Shamu said.
“When they make gains, it really helps push the market a bit higher.”
Mr Shamu also said the local bourse may have been boosted by expectations that commentary from the US Federal Reserve on Thursday on the timing of a future interest rate hike will be friendly to equity markets.
Among the major banks, Commonwealth Bank rose $1.88 to $84.26, ANZ gained 69 cents to $32.86, National Australia Bank jumped 58 cents to $33.37, and Westpac ascended 60 cents to $32.90.
In the resources sector, global miner BHP Billiton was 42 cents higher at $28.17, Rio Tinto firmed 12 cents to $56.03, and Fortescue Metals dumped 10 cents to $2.22.
Supermarket giant Woolworths was four cents lower at $26.80 after chief executive Grant O’Brien announced his departure as the retailer downgraded its profit guidance and said it would axe 1,200 jobs.
KEY FACTS
* At 1625 AEST on Wednesday, the benchmark S&P/ASX200 index was up 59.6 points, or 1.08 per cent, to 5,595.4 points.
* The broader All Ordinaries index was up 55.1 points, or one per cent, to 5,590.3 points.
* The June share price index futures contract was 61 points higher at 5,588 points, with 76,437 contracts traded, according to preliminary figures.
* National turnover was 1.56 billion securities worth $5.38 billion.
