Investors have jumped back into trade after the Australia Day holiday, pushing the share market to a new 21-month high.
The biggest gains were in health and telecommunications stocks, but all sectors advanced.
The All Ordinaries index rose by 1.1 to 4,911.
The ASX 200 index gained the same amount to 4,889.
Shares in the Commonwealth Bank rose by 1.1 per cent to a record high of $64.73.
Other bank stocks also reached multi-year highs and Westpac gained 2.4 per cent.
However, insurance stocks struggled amid flood disasters in Queensland and New South Wales with QBE losing 2.7 per cent while Suncorp fell nearly 2 per cent.
Elsewhere in the finance sector, shares in Macquarie Group rose by 0.6 per cent on the day the corporate regulator announced action against one of its divisions for what it called "serious compliance deficiencies".
ASIC found that Macquarie Private Wealth had lax standards of record keeping and lacked commitment to compliance.
Macquarie says the company takes its regulatory obligations "very seriously" and is committed to making the necessary changes.
Elsewhere on the market, the major mining stocks managed moderate gains - BHP Billiton rose by 0.2 of a per cent and Rio Tinto edged up 0.1 of a per cent.
And Telstra rallied 2 per cent to $4.67.
NAB's latest business survey has found confidence among business owners recorded its biggest monthly rise since September 2011, with gains in all sectors.
But the survey found conditions for business activity remain weak.
And a survey of nearly 500 businesses by the Australian Industry Group has found many are overestimating rises in their energy costs caused by the price on carbon.
The businesses estimated their energy prices increased on average by 14.5 per cent by the end of November.
But AIGroup says that is more than double the price increase found by the Australian Bureau of Statistics.
In commodities, spot gold had risen to $US1,661 an ounce by 5pm (AEDT).
West Texas crude oil was slightly higher at $US96 a barrel.
And Tapis crude's lower at $US120.70 a barrel.
In currency trade, the Australian dollar was buoyant against most of its major counterparts.
At 5pm it was buying 104.5 US cents, 77.7 euro cents, 94.8 Japanese yen and 66.6 British pence.