The Australian sharemarket closed the week’s first trading session on a positive note, with investor sentiment buoyed by China promising new measures to boost consumption and economic growth.

The benchmark S&P/ASX 200 Index rose 0.8 per cent, or by 64.4 points, to 7854.1, notching its best gain in two weeks. The All Ordinaries gained 0.9 per cent as eight of the bourse’s 11 industry groups traded in the green, led by the mining sector.

Shares initially tracked a strong rally on Wall Street after the S&P 500 Index jumped 2.1 per cent at the end of last week, rebounding from weeks of selling and boosted by a rally by the US technology giants. An early rally in ASX-listed tech stocks softened in the afternoon as US futures opened lower, suggesting more selling on Wall Street to come.

China boost

Meanwhile, a mixed bag of economic reports from China failed to dent bullishness towards Australia’s big miners amid Beijing’s promise of new consumption-stimulating measures that are intended to boost real incomes and support the ailing property sector. An announcement was expected late Monday.

Rio Tinto gained 1.8 per cent to $119.20, Fortescue 4.2 per cent to $16.95 and BHP climbed 2.4 per cent to $39.58. Mineral Resources was also well bid, jumping 9 per cent to $23.95 after UBS upgraded the stock to “buy” from “sell”.

AMP economist My Bui said China’s targeted approach to consumption was needed to bolster the economy.

“We are mostly interested in any stimulus measures that can incentivise consumers to spend more … [prior] stimuli have worked, but [that] hasn’t played out in inflation data yet, which is quite disappointing, it shows that consumers still require discounting to spend,” she said.

Energy stocks climbed with the oil price, which held above $US71 a barrel on hopes that the stimulus from the world’s largest importer of crude would boost prices. Oil and gas explorer Woodside rose 1.9 per cent to $22.81 and petrol producer Ampol 2.6 per cent to $24.53.

Some of the big banks extended gains. Commonwealth Bank advanced 1.6 per cent to $144.66 and ANZ 1.4 per cent to $28.69. Westpac lifted 1 per cent to $29.89, while National Australia Bank slipped 0.2 per cent to $33.24, after it revealed chief financial officer Nathan Goonan was joining Westpac.

Stocks in focus

In corporate news, Spartan Resources rallied 9.1 per cent to $1.75 after confirming Street Talk’s report of its merger with Ramelius Resources. The latter retreated 0.9 per cent to $2.18.

Smartpay Holdings leapt 47.2 per cent to 78¢ after confirming it was in takeover talks with at least two parties. That’s after the payments processor’s shares were smashed on the central bank’s decision to put debit card surcharges under the microscope.

Investment manager Navigator Global added 2.6 per cent to $1.81 after announcing plans to acquire a minority stake in US private equity house 1315 Capital for $US70.5 million ($111.44 million).

And microcap ballistics manufacturer Highcom jumped 11.9 per cent to 24¢ after it received a $3 million order for its “high end” products from an international customer as countries boost their defence spending.