Australian stocks surged 3.0 percent in early trade on Wednesday, building on their gains from the previous day after sharp rebounds in the United States and Europe overnight.
At 10:15 am, the benchmark S&P/ASX 200 was up 120.8 points at 4,155.6 after the US Federal Reserve said it expected to maintain interest rates at ultra-low levels for the next two years.
Australian stocks staged a stunning turnaround on Tuesday, recovering from a slump of more than 5.5 percent to end in the black on rumours the Federal Reserve may outline plans for a new stimulus package.
"It's a much more pleasant open to Australian trade today as stocks follow the big snap-back rally on Wall Street," said IG Markets analyst Ben Potter.
"Whilst it is very positive to see the gains, the big question is going to be how long the rally lasts before participants are faced with the question of whether this is just a bounce, like it usually is, or is actually a meaningful bottom."
After dropping back below parity with the greenback for the first time since March on Tuesday, the commodities-linked Australian dollar also continued its comeback.
In early trade it was at 103.18 cents, up from 102.25 cents on Tuesday.
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