Australian shares added 1 percent on Monday as strong bullion prices lifted gold miner Newcrest Mining, while St. George Bank and Westpac Banking climbed on expectations of strong earnings.
The benchmark Australian S&P/ASX 200 Index rose 51.6 points to 5,310.4, based on the latest Reuters data, reversing Friday's 0.8 percent fall. The index, which scaled a new peak last week, is up 11.5 percent in 2006, fuelled by a boom in commodity prices.
"People are looking for some good results from banks and bank shares have been bought on those expectations," said Sean Fenton, a portfolio manager with Jenkins Investment Management.
Investors returned to the big miners such as BHP Billiton Ltd/Plc and Rio Tinto Ltd/Plc as metals prices recovered after last week's sell-off. BHP and Rio rose 4 percent and 3.7 percent respectively.
"Most commodity prices ended firmer last week and that has revived confidence in metal stocks," said Steven Robinson, a portfolio manager with Alleron Investment Management.
A.B.C. Learning Centres Ltd, the nation's top childcare operator, dropped 0.9 percent to A$7.75 as it resumed trading after raising A$600 million ($455 million) through a share placement to institutions at A$7.30 per share, a 6.6 percent discount.
Newcrest Mining Ltd, the nation's top gold miner, added 3.1 percent to A$23.50 and Bendigo Mining Ltd firmed 2.1 percent to A$2.39 after gold futures jumped 3 percent to a 25-year high on Friday.
St. George Bank Ltd, the nation's fifth-biggest commercial bank, firmed 0.4 percent to A$30.96 ahead of its first-half earnings on Tuesday. Westpac Banking Corp, the nation's fourth-biggest bank by market value, added 0.6 percent to A$25.26. Westpac is projected to post about a 12 percent rise in its first-half earnings on Thursday.