The Australian bourse rallied on Monday, posting a record increase this month, as the investment community took heart from reassurances by US Federal Reserve chairman Ben Bernanke.

The benchmark S&P/ASX200 index finished 82.6 points or 1.9 per cent higher at 4452.7. The broader All Ordinaries index, meanwhile, added 79 points or 1.8 per cent to 4483.1. However, even with today's improvement, stocks are still down about 1 per cent in August after three weekly losses.

Of the major sectors, financials climbed 2.2 per cent today, while materials gained 2.1 per cent and energy added 1.6 per cent.

''Wall Street provided our market with the perfect excuse to push higher today,'' according to CMC Markets analyst David Taylor.

''At first we had Ben Bernanke's comments combine with better than expected GDP data out of the States. We then saw the VIX Index (volatility index) move down to 24, the Aussie dollar shoot up to 90 US cents, and a fall in US Treasuries," he said.

''It's the kind of day that makes it very hard to stay out of the market.''

Wall Street rebounded last week after the release of reassuring news.

On Friday night (AEST), the Federal Reserve chairman Ben Bernanke said the central bank stood ready to act if needed to spur slowing growth, and downplayed concerns the economy might slip back into recession.

The US Department of Commerce also announced that gross domestic product (GDP) expanded at an annualised 1.6 per cent

''Everyone was expecting 1.1 per cent GDP in the US last week, so 1.6 per cent was lower but nowhere as low as people expected,'' Bell Financial Group senior adviser Chris Kimber said.

''On top of that, Bernanke (was) pumping it up a little bit and saying that he will everything he can.''