Materials lead stocks firmly higher

The local market has added more than 0.5 per cent, as stronger iron ore prices bolstered sentiment.

The Australian sharemarket has surged into a stronger close, thanks to strength in the materials and financial sectors throughout the session.

At the end of trade, the benchmark S&P/ASX 200 index had jumped 34.3 points, or 0.63 per cent, to 5,442.8, while the broader All Ordinaries index rallied 34.2 points, or 0.62 per cent, to 5,523.3.

Materials shone brightest among the major sectors, aided by a fresh seven-week peak in iron ore prices.

The news, coupled with an upbeat investor presentation from Fortescue, pushed materials up almost 1 per cent by the close.

Fortescue led the way in surging 6.5 per cent to a new two-and-a-half-year high of $5.44, while BHP bounced 0.4 per cent to $23.19 and Rio Tinto jumped 2.4 per cent to $52.48.

But the smaller real estate and IT sectors received the strongest bids, due to positive trading updates from Mirvac, Dexus and Aconex.

Property groups Mirvac and Dexus advanced 0.9 and 1.8 per cent, respectively, while construction software group Aconex soared 13.1 per cent.

In contrast, Ardent Leisure shares lost 7.8 per cent on news of a tragic ride malfunction at its Dreamworld theme park.

Investors are likely to focus on the banks through the coming fortnight as trading updates are due from the big four, but for now there appears little concern.

“As we saw Monday, with Aussie financials rallying 0.8 per cent off the opening low and subsequently dragging the broader index with it, there seems little concern about buying banks ahead of second-half earnings for fiscal 2016,” IG chief market strategist Chris Weston said.

“The earnings release start on Thursday with NAB, with the financials having gained 3 per cent thus far in October, just lagging behind the staples sector.”

The big four banks all ended in the black, with Westpac outperforming by advancing 1.1 per cent and NAB’s 0.6 per cent rise trailing its peers.

In energy, Santos slid 0.8 per cent to $3.70, while Woodside weakened 0.3 per cent to $28.91 after crude prices retreated overnight.

Among blue chips, Telstra was steady at $5.05, while Qantas skidded 1.9 per cent to $3.17.

Private hospital operator Healthscope recovered 1.8 per cent after heavy losses across the past two sessions, while peer Ramsay Health Care bounced 1.4 per cent.

Meanwhile, the Australian dollar steadied gained US0.3c, ending the local session at US76.3c.