At 10.10am (AEDT) the benchmark S&P/ASX200 was 27.7 points higher at 3482.6, while the broader All Ordinaries gained 23.7 points to 3417.1.
Austock Securities senior client advisor Michael Heffernan said the local market was being driven higher by strong gains from the banking stocks and a positive move by David Jones.
"We've bolted out of the gates and the banking stocks are just flying,'' Mr Heffernan said.
"We had a pretty good lead-in from the US market, while commodities were a bit flat, so we were going to be positive this morning.
The big banks were higher.
NAB added 35 cents to $19.28 by 10.12am, ANZ gained 26 cents to $14.69, Commonwealth Bank put on 65 cents to $33.12 and Westpac found 19 cents to $17.90.
ANZ said the company would absorb its separately managed specialist asset finance business Esanda Finance Corporation Ltd into the bank.
"David Jones is up over 7 per cent, which is a stunning performance," said Mr Heffernan.
"The retail sector seems to be weathering the storm very well.''
Upmarket retailer David Jones gained 19 cents to $2.68 by 10.21am and has lifted its first half profit by 2.4 per cent and affirmed its guidance, saying it is well prepared for the economic downturn.
The other retailers were mixed, with Woolworths losing 10 cents to $25.24, Wesfarmers adding 30 cents to $18.70 and Harvey Norman picking up 1 cent to $2.59.
The media sector was mixed.
News Corporation added 20 cents to $10.72, Fairfax picked up 2.5 cents to 95.5 cents and Consolidated Media Holdings was steady at $2.14.
The market received a positive lead from Wall Street, which as shares rallied on an upbeat report on home construction and pushed the Dow Jones Industrial Average 178.73 points higher to 7395.70.
On the Sydney Futures Exchange the March share price index contract was 3 points higher at 3482 on a volume of 38,163 contracts.
More to come.
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