The House of Representatives vote to approve a fiscal cliff compromise deal has pushed shares higher.
The All Ordinaries Index was up 59 points to 4,724 just before 3:30pm (AEDT), and the ASX 200 index was also 1.25 per cent points stronger at 4,707.
Shares built on modest morning gains as it became increasingly apparent that a Senate bill to avoid the fiscal cliff would be passed by the House of Representatives - as it was 257 votes to 167 just before 3:00pm (AEDT).
The local share market is also being led higher by mining stocks after iron ore prices jumped in China yesterday.
Market heavyweight BHP Billiton had added 1.7 per cent, Rio Tinto 2.4 per cent, and iron ore specialist Fortescue was 5.2 per cent stronger at $4.89.
Media companies were also performing well - Ten Network had risen 1.8 per cent and APN News and Media had added 2 per cent.
The big banks were also rising, albeit more modestly - Commonwealth was the best of the four major lenders, rising 1 per cent.
Telstra had gained 1.6 per cent.
CSL and BlueScope were among the few stocks falling, both down 0.3 per cent, as manufacturers were hit by a strong rise in the Australian dollar.
The local currency was buying 104.7 US cents after the bill to avoid the fiscal cliff passed both houses of Congress - up around a cent from this morning's lows.