Australia's share market posted its strongest performance in more than a week, as the heavyweight financial sector was helped by easing bond yields and a reinforced message on low rates.
The S&P/ASX200 benchmark index closed higher by 54.1 points, or 0.8 per cent, to 6827.1 on Tuesday.
The index closed above 6800 points for the first time in more than a week.
The All Ordinaries closed up by 59.9 points, or 0.85 per cent, at 7079.
Information technology was the top sector, rising 2.95 per cent, while health and property gained more than two per cent each.
The commodity sectors of materials and energy fell less than one per cent each.
Concerns over China's demand for iron ore affected the former, while there were concerns about stockpiles of oil in the US after freezing temperatures last month.
Still, Burman Invest chief investment officer Julia Lee said the ASX had a strong performance.
"It's quite impressive given US futures has not been doing much," she said of the overseas after-market trade.
Ms Lee was interested in the financial sector, which rose 0.68 per cent.
The big four each gained less than one per cent.
"There has been an impressive turnaround from the banks, which are looking strong," she said.
"It has to do with the RBA message of keeping rates that are supportive of the economy."
The Reserve Bank, in the minutes of its March meeting, spruiked its message that rates will remain low.
It noted investors had brought forward expectations of rate increases.
Yet the board said the cash rate of 0.1 per cent would remain as long as necessary.
Ms Lee said low rates were a double-edged sword for banks.
These are not helpful for charging higher interest on loans.
"But on the flip side, low rates do stir demand for housing," Ms Lee said.
Banks were helped by bond yields easing on Tuesday, Ms Lee said. Higher yields could challenge dividends, she said.
Earlier, the US S&P 500 and Dow Jones indices closed at record highs as investors eyed economic recovery from the coronavirus and awaited cues from the US central bank amid caution over rising borrowing costs.
The Federal Reserve has a two-day meeting this week and policymakers are expected to forecast that the US economy will grow in 2021 at its fastest rate in decades.
Meanwhile the Nasdaq was higher.
On the ASX, property group Dexus said it would merge its wholesale property fund with AMP Capital's property fund.
The Dexus fund has $10.1 billion worth of retail, office and industrial properties, while the AMP Capital fund has $5 billion.
Those with financial interests in the funds will vote next month.
Dexus shares were higher by 2.89 per cent to $9.61.
AMP shares were up 0.34 per cent to $1.46.
Casino and resort giant Crown said it would no longer make political donations.
The change follows a NSW report which found Crown unsuitable to hold the licence for a Sydney casino.
Two royal commissions will examine Crown's operations in Perth and Melbourne.
Shares were up 0.7 per cent to $10.08.
In mining, BHP dropped 2.17 per cent to $46.84, Fortescue gained 0.69 per cent to $20.52 and Rio Tinto dropped 1.11 per cent to $112.86.
On Wednesday, Reserve Bank assistant governor for financial markets Christopher Kent will address an Australian Finance Industry Association forum.
New Zealand dairy co-operative Fonterra will give first-half earnings to the ASX.
The Australian dollar was buying 77.43 US cents at 1720 AEDT, lower from 77.44 US cents at Monday's close.
ON THE ASX
* The S&P/ASX200 benchmark index closed higher by 54.1 points, or 0.8 per cent, to 6827.1 on Tuesday.
* The All Ordinaries closed up by 59.9 points, or 0.85 per cent, at 7079.
* At 1720 AEDT, the SPI200 futures index was up by one point, or 0.01 per cent, and trading at 6834 points.
One Australian dollar buys:
* 77.43 US cents, from 77.44 cents on Monday
* 84.56 Japanese yen, from 84.43 yen
* 64.94 Euro cents, from 64.76 cents
* 55.86 British pence, from 55.57 pence
* 107.66 NZ cents, from 107.52 cents.