SYDNEY: Australian shares rose 0.6 percent in morning trade on Friday, shrugging off a decline on Wall Street and taking their cue from strong gains in commodity prices overnight and a global move towards riskier assets.
Analysts said the local market was also responding to events over the last few days after being closed for a public holiday on Thursday.
"US markets were weaker, but at the same time the previous night was stronger, so it was all about the net effect of the two days," said Stan Shamu, market strategist IG Markets.
"The main issues we saw were those comments from the FOMC on Wednesday, and well unfortunately we were closed yesterday so we didn't actually manage to benefit from the strong rally we saw in risk assets on Thursday," he added.
The Fed announced on Wednesday it would probably keep interest rates near zero until at least late 2014 -- some 18 months later than the Fed had suggested last year
"We are a high risk market and obviously we've got a lot of risk assets particularly in the mining space and the strength in the risk rally over the past couple of days was going to be quite positive and supportive of our mining sector," Shamu said. Global miner Rio Tinto was up 1.9 percent, BHP Billiton rose 1.1 percent and Fortescue gained 3.1 percent in early trade.
"We've also got strong gains in the gold space after gold had a pretty strong run, following those comments that the US might engage in further quantitative easing," he added.
Gold miner Newcrest rose 2.8 percent in morning trade, buoyed by strong gold prices.
Companies such as Rio Tinto, BHP and Woodside Petroleum will be watching Tropical Cyclone Iggy very closely, as it is expected to strengthen as it moves towards Australia's northwest coast, threatening the region's rich mining fields after shutting down some offshore oil production facilities.
Woodside Petroleum and Apache Corp suspended some oil production on Wednesday due to the storm system.
Australia's big four banks also performed well in morning trade, with Westpac up 0.8 percent and National Australia Bank up 0.3 percent.
The benchmark S&P/ASX 200 index was up 24.3 points at 4,295.6 at 0036 GMT. The market was closed on Thursday for the Australia Day public holiday. The index rose 1.1 percent, to a seven-week high, on Wednesday.
New Zealand's benchmark NZX 50 index rose 0.4 percent to 3,293.2 after New Zealand posted its first monthly trade surplus in five months.
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