Shares of buy-now-pay-later firm Afterpay Ltd climbed to A$39.59 within the first few minutes of the open, not far off an all-time high of $41.14 they reached in February.
The reveal of Tencent Holdings as an Afterpay shareholder "seems to have fired up imagination for more potential international buying into the Australian market", said Michael McCarthy, chief market strategist at CMC Markets.
The news also helped the subindex for industrial stocks rise 1.5%.
Healthcare stocks rose more than 2%, with heavyweight CSL Ltd adding 2.9%, while Resmed Inc gained 1.9%.
A weaker Australian dollar also helped as the healthcare sector relies on exports to the United States.
Gold stocks outperformed all other subindexes to rise more than 6%, with Newcrest Mining jumping over 6.5%.
Financials were higher, with the "Big Four" banks rising between 1.8% and 2.8%.
Westpac Banking Corp, Australia's second-largest lender, settled higher even after it posted a 70% drop in first-half cash earnings and halted its decision on an interim dividend.
The number of issues on the ASX that advanced were 694 while 901 declined.
The most heavily traded shares by volume were of Qube Holdings as the logistics services provider resumed trading after being voluntarily halted since April 27, shortly after which the company announced a A$500 million equity raise.
New Zealand's benchmark S&P/NZX 50 index settled slightly higher, helped by gains in consumer and financial stocks.