Aust stocks soar 2.6% at close as RBA holds fire

The Australian stock market accelerated gains to 2.6% as it broke the 4800 threshold at the close, after the Reserve Bank of Australia held the cash rate at a record low for the second straight month.

The Australian stock market accelerated gains to 2.6% as it broke the 4800 threshold at the close, after the Reserve Bank of Australia held the cash rate at a record low for the second straight month.

The central bank's move added to optimism from a rebound on Wall Street overnight, which saw the Dow Jones start July on a positive note after a promising duo of local economic reports.

The rally saw it recoup yesterday's heavy losses, when investors ran for the exits as two Chinese manufactury reads reignited growth concerns for the world's second-biggest economy's.

At the 1615 AEST official market close, the local benchmark S&P/ASX200 index rose 2.63% to 4834 points, while the broader All Ordinaries index was 2.57% higher at 4810.3 points.

CMC Markets sales trader Betty Lam said materials were finding support despite China's disappointing expansion numbers, taking leads from positive manufacturing reads across Europe overnight.

Resources stocks were stronger, with the major miners leading the market.

On Monday, more than $27.5 billion was wiped off the value of the local market after manufacturing data released in China showed expansion fell to 50.1 points from 50.8 in May.

The benchmark S&P/ASX200 index was down 92.3 points, or 1.92%, at 4,710.3 points, while the broader All Ordinaries index was down 85.7 points, or 1.79%, to 4,689.7 points.