Wall Street high buoys Australian stocks

Positive comments from US Federal Reserve chairman Ben Bernanke, including expectations that the unemployment rate would keep falling, helped Wall Street post its biggest gains of the year and the Dow Jones Industrial Average surge past the 13,000-mark.

Locally, the benchmark S&P/ASX 200 Index was up 39.6 points, or 0.93 per cent, at 4287.2.

It has briefly lifted above 4300 points in recent months but has always slipped back below that mark due to continuing concerns about the global economy.

The last time the index spent a sustained period above the milestone level was in August last year.

The local market pushed higher in line with overseas markets, Shaw Stockbroking senior dealer Jamie Spiteri, said. "You've got an equity market that's gaining a little bit more confidence but coming off a fairly subdued base in recent times."

Market analyst Michael Heffernan said the local market's performance was a little disappointing compared with that of its overseas counterparts.

Business and consumer confidence was downbeat, but the equity market

was upbeat and would do well this year because "it's been held back for so long", he said.

Most sectors made solid gains, with financials and major resource stocks trading more than 1 per cent higher.

BHP Billiton rose 46?, or 1.3 per cent, to $35.61, while rival Rio Tinto jumped 95?, or 1.5 per cent, to $65.30.

Woodside Petroleum lost 31? to $35.59 but Oil Search surged 15?, or 2.2 per cent, to $7.14 and Santos added 17?, or 1.2 per cent, to $14.57.

Commonwealth Bank led the big four banks higher, closing up 43?, or 0.9 per cent, at $48.80. QBE Insurance was a standout, jumping 41?, or 3.3 per cent, to $12.87, while Insurance Australia Group gained 7?, or 2.1 per cent, to $3.39.

"QBE's a stock that's been hit very hard the worst-performing top 20 stock in our market in recent years and they're coming off a low base," Mr Spiteri said.

An improved US economy was beneficial to QBE and Macquarie Group, he said. Shares in Macquarie advanced 56?, or 2.1 per cent, to $27.23.

Fortescue Metals Group said it would raise $US1 billion through a bond issue to fund its big expansion plans. Fortescue shares were up 6?, or 1 per cent, at $5.83. Gold closed in Sydney at $US1672.55 an ounce, down $US30.63.

National turnover reached 2.2 billion securities, worth $5 billion. AAP