Australian stocks rallied 1.7 percent on Wednesday, the biggest gain in five weeks, joining offshore markets in bets that central banks will turn on the cash spigots to boost flagging economic growth worldwide.

At the 1615 AEDT official market close, the benchmark S&P/ASX200 index was 1.73 per cent higher to 4,686.8 points and the broader All Ordinaries edged up 1.66 per cent to 4,738 points.

Commodities prices leapt on the prospect of more moves to underwrite global growth from the central banks of Japan and the US, and hopes for a weaker greenback.

"The Bank of Japan may be the precursor for other central banks around the world. So on the one hand there is a positive mood that you are going to get quantitative easing," said Argonaut director of research Ian Christie.

"But at the same time that easing reflects underlying weakness in the economies and we aren't immune to what's happening in the rest of the world," he added.

The major miners led the market, with BHP Billiton rising 2.6 per cent to $40.53 and Rio Tinto climbing 2.58 per cent to $78.99.

Their shares were unaffected by a report quoting Rio Tinto's chairman saying the company was going to tell BHP it wanted to scrap their proposed iron ore joint venture.

Fortescue Metals Group grabbed four per cent to $5.45 after the resolution of a shipping dispute put damages in line with guidance.

But some questioned whether the strong gains for resource shares would be sustained.

"This is providing a perfect run for resources stocks, though one has to wonder if a near-term round of profit taking is on the cards," said IG Markets analyst Cameron Peacock. "We think any meaningful dips will be bought in force."

The big four banks also closed stronger, with Commonwealth Bank of Australia making up 1.15 per cent to $51.84, National Australia Bank climbing 2.01 per cent to $25.88 and Westpac Banking Corp lifting 1.34 per cent to $23.42. ANZ Banking Group advanced 2.12 per cent to $24.07.

With Reuters