Stocks 1pc stronger at noon

Banks have been bid sharply higher as Deutsche fears ebb, with Westpac adding 2.2 per cent.

The Australian share market has gained more ground as the big four banks lead the way for a surging financial sector.

At 12 noon (AEST), the benchmark S&P/ASX 200 was up exactly 1 per cent in the wake of improved local manufacturing data and speculation that global banking giant Deutsche Bank’s huge US fine could be slashed.

The broader All Ordinaries index was up 51.8 points, or 0.94 per cent, to 5,577.0 points.

The local market was boosted by news Deutsche Bank was likely to settle with the US Department of Justice for less than half the purported fine, IG market analyst Angus Nicholson said.

“Deutsche Bank gained 7.7 per cent on Friday off the news and was a major driver of risk-on sentiment across a range of asset classes.”

While financials led the way offshore, the energy sector also outperformed, a good sign for the local market, according to Mr Nicholson.

“A similar sectoral performance in the ASX today would be very positive for the index,” he said.

Meanwhile, Commonwealth Bank had risen $1.32, or 1.82 per cent, to $73.72 a day ahead of chief executive Ian Narev’s appearance before the House of Representatives’ standing committee on economics.

Westpac was 65 cents, or 2.2 per cent, higher at $30.16, ANZ had risen 35 cents, or 1.27 per cent, to $35.00, and National Australia Bank had gained 25 cents, or 0.90 per cent, to $28.12.

Energy firms Origin, Oil Search, Santos and Woodside Petroleum were also higher following further rises in oil prices, with Santos the biggest gainer in percentage terms - up 9.0 cents, or 2.49 per cent, to $3.70.

with AAP