The Australian sharemarket closed strongly firmer for its best performance in over a week after a compromise was reached in the United States to lift America's debt ceiling.
However, local traders said the rally could be short lived because of ongoing debt concerns in Europe.
The benchmark S&P/ASX200 index gained81.6 points, or 1.83 per cent, to 4549.7.
On the ASX 24, the September share price index futures contract closed up 84 points at 4526 points, with 38,565 contracts traded.
Burrell Stockbroking adviser Jamie Elgar said the passage of legislation increasing America's debt-ceiling bolstered the market.
"The US is really focusing on that, rather than the corporate earnings that have been coming out that have been pretty good, and they were pretty good last night again on IBM and Apple," he said.
All sectors of the local market rose.
Among banking stocks ANZ was up 43c at A$21.20, National Australia Bank rose by 62c to A$24.29, Westpac gained 48c to A$21.16, and Commonwealth added A$1 to A$49.55.
News Corp was the best performer in the top 100 stocks, up 74c, or 5.1 per cent, at A$15.24, while its non-voting stock was up 67c, or 4.8 per cent, at A$14.75.
News chief executive Rupert Murdoch has said he would not resign because of the phone hacking scandal in Britain.
In the resources sector, BHP Billiton was up 82c, or 1.92 per cent, at A$43.44 after it reported production records for four commodities in 2010/11. Rio Tinto gained A$1.22, or 1.5 per cent, to A$82.55. Gold miner Newcrest Mining gained 8c to A$40.81.
