The S&P/ASX200 gained 84.5 points on Thursday, up 0.96 per cent to 8,878.1, as the broader All Ordinaries advanced 90.9 points, or 1.01 per cent, to 9,107.
Miners charged higher on the back of stronger metal prices while energy and utilities stocks dropped following reports Iran was mulling a US peace deal that could lead to the gradual reopening of the Strait of Hormuz.
But market optimism around the reports could prove premature, RBC Capital Markets head of global commodity strategy Helima Croft said.
"Once again, another pre-market headline based on White House sourcing has sent oil sharply lower," Ms Croft said.
"However, it remains far from clear that there is any material movement toward reopening the Strait of Hormuz, or if we are instead stuck in a rebranded 'ceasefire with no oil' purgatory for the time being."
As Brent crude prices hovered about $US100 a barrel, Woodside (down 4.2 per cent), Santos (down 3.3 per cent) and Origin (down 2.6 per cent) sold off.
Refinery operator Ampol was down 2.3 per cent, while competitor Viva tumbled 5.1 per cent after director Scott Wyatt unloaded more than $600,000 in stock.
Mega miners BHP, Rio Tinto and Fortescue each gained more than 3.2 per cent, with iron ore futures trading at 19-month highs near $US111 a tonne.
Gold miners were also strong as the precious metal lifted to $US4,714 ($A6,511) an ounce, supporting names such as Evolution and Northern Star, which jumped more than six and four per cent respectively.
Lynas Rare Earths, South32 and PLS, formerly Pilbara Minerals, also advanced on improving sentiment and higher commodity prices.
Shares in blasting solutions and mining chemicals company Orica rocketed 7.6 per cent higher to $22.50 after it posted record earnings in the six months to March, bolstered by commodity prices and minimal disturbance from the Persian Gulf crisis.
The heavyweight financials segment rose 0.4 per cent, with three of the big four banks in the green, as NAB eased 1.3 per cent to $39.51 after going ex-dividend.
Beaten-down health care stocks fell to a new 2026 low, with the sector trading at its lowest value since February 2018.
In company news, Tabcorp shares tanked more than 23 per cent after AUSTRAC launched an investigation over "serious concerns" about the group's compliance with anti-money laundering obligations.
Gaming machine group Light & Wonder fell more than eight per cent after a disappointing trading update, further weighing on the consumer discretionary sector.
ARN Media recovered early losses to finish the session with a 1.9 per cent improvement after its trading update revealed an advertising boycott of its Kyle and Jackie O radio show cost the company $26.4 million.
The Australian dollar is buying 72.50 US cents, up slightly from 72.49 US cents on Wednesday at 5pm.
ON THE ASX:
* The S&P/ASX200 jumped 84.5 points, or 0.96 per cent, to 8,878.1
* The broader All Ordinaries fell 90.9 points, or 1.01 per cent, to 9,107
One Australian dollar trades for:
* 72.50 US cents, from 72.49 US cents at 5pm AEST on Wednesday
* 113.32 Japanese yen, from 113.37 Japanese yen
* 61.72 euro cents, from 61.78 euro cents
* 53.31 British pence, from 53.34 British pence
* 121.67 NZ cents, from 121.79 NZ cents
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