The share market has capped off its best week in almost four years as strength in the financial and resources sectors drove a fifth straight day of gains.
Buoyed by a stronger Aussie dollar and a jump in iron ore and oil prices, the market rose 1.3 per cent, taking the weekly gain to 4.3 per cent.
Fears of a Chinese economic downturn and concerns about a US interest rate hurting markets have dissipated, CMC chief market strategist Michael McCarthy said.
"What we're seeing this week is a backing away from that extreme pessimism," he said.
"I won't suggest investors have become more optimistic, I'd say they've become less pessimistic."
The weekly gain is the market's best since early December 2011.
Rio Tinto climbed $2.00, or 3.8 per cent, to $55.18 and BHP Billiton added 60 cents, or 2.4 per cent, to $25.60.
Investors jumped on Macquarie Group after the company issued five million new shares at a premium to part-fund its $8.2 billion acquisition of ANZ's Esanda car leasing and financing business.
The investment bank led the financial sector with a gain of $3.10, or four per cent, to $80.94, while three of the big four banks gained more than one per cent, and Commonwealth gained 0.2 per cent.
Energy shares continued their rally, with Santos up 47 cents, or 8.55 per cent, at $5.97 and Woodside gaining 82 cents, or 2.6 per cent, to $32.61.
"A big feature of the week has been the big turnaround of the resource stocks in general and energy stocks in particular," Mr McCarthy said.
"This has been the missing component of the Australian market."
* At the close on Friday, the benchmark S&P/ASX200 index was up 69.3 points, or 1.33 per cent, at 5,279.7 points.
* The broader All Ordinaries index was up 67.8 points, or 1.29 per cent, at 5,309.2 points.
* The December share price index futures contract was up 73 points at 5,267 points, with 28,021 contracts traded.
* The price of gold in Sydney at 1700 AEDT was $US1,148.25 per fine ounce, up $US5.45 on Thursday's price of $US1,142.80.
* National turnover was 1.9 billion securities worth $5.7 billion.