Overnight, Wall Street surged on reports private sector employment rose by 93,000 in November, while the US Federal Reserve said it expects the US economy to continue to improve.

The Dow Jones Industrial Average shot up 2.27% to close at 11,255.78 points, while the NASDAQ gained 2.05% to 2549.43 points and the broader S&P 500 index gained 2.2% to 1206.07 points.

Meanwhile, solid manufacturing activity in China also buoyed sentiment in Asian markets with the Shanghai Composite index up 1.5% and Nikkei 225 index up 1.7%.

"The recovery in manufacturing activities (worldwide) and improvement in US job conditions are spurring expectations for expansion in the global economy," Dow Jones Newswires quoted Cosmo Securities equity strategist Toshikazu Horiuchi as saying.

Closer to home, and the S&P/ASX 200 index shot to an intraday high of 4685.1 points, its highest point in more than two weeks, before cooling slightly to close at 4676.2 points, up almost 2%. The All Ordinaries closed at 1.8%, up 4761.8 points.

On the resources front and BHP Billiton gained $1.13 to close at $44.33, while rival Rio Tinto finished $1.91 higher at $85.01.

OZ Minerals was one of the standout performers at the bigger end of town, adding 7.5c to close at $1.63, while Fortescue Metals Group finished 6c higher at $6.41. However, Paladin Energy bucked the upward trend to close 2c lower at $4.98.

Base metals on the London Metal Exchange were up across the board in overnight trade. Copper for three-month delivery gained 2.7% to $US8585, while nickel added 2.2% to $23,550/t and zinc jumped 2.3% to $2160/t.

Spot gold was trading 0.3% higher at $1391 per ounce at 4:37pm AEDT.

The combination of US quantitative easing and the worsening eurozone fiscal situation will mean higher gold prices ahead, Dow Jones quoted Swiss-based fund manager Precious Capital AG as saying.

"Considering the unprecedented dimensions of QE2, we expect an ongoing shift of liquidity into gold which will further increase the purchasing power of the yellow metal," the fund manager said.

The bulk of gold stocks on the Final Call watchlist made gains today. Newcrest Mining added 71c to close at $40.40, Perseus Mining added 1c to $3.22, while Medusa Mining gained 37c to $6.85.