Australian shares notched their best session in nearly two months on Monday, as upbeat economic data strengthened recovery hopes, while the central bank increasing the size of its daily quantitative easing programme also aided sentiment.

The S&P/ASX 200 index rose 1.7% to close at 6,789.6 in a solid start to March, posting its biggest intraday percentage gain since Jan. 7.

Home prices surged at the fastest pace in almost two decades in February and job advertisements also skyrocketed, in further evidence that the economy is rapidly emerging from its once-in-a-generation recession.

"The overall picture for the Lucky Country is that it remains lucky, and its recovery continues," said Jeffrey Halley, senior market analyst for Asia Pacific at OANDA.

The Reserve Bank of Australia (RBA) boosted investor sentiment by announcing a larger-than-usual A$4 billion ($3.10 billion) worth of bond purchase.

The move comes ahead of RBA's monthly board meeting on Tuesday where it is likely to leave rates unchanged. However, markets will eye the post-meeting statement for any commentary on soaring home prices, rising bond yields and an appreciating currency.

Real estate stocks rose sharply on home price data, making them one of the leading gainers on the benchmark index. Stockland Corp, Charter Hall Group and Goodman Group jumped about 4% each.

New Zealand's benchmark S&P/NZX 50 index rose 0.6% to finish the session at 12,301.81.

Auckland, the country's biggest city, was thrown into its fourth pandemic lockdown over the weekend, prompted by just a single new COVID-19 case.

That weighed on tourism stocks, with Tourism Holdings and Kathmandu Holdings sliding about 2% each.