S&P/ASX 200 (INDEXASX:XJO) gained 102 points or 1.59% to 6546.3 with all sectors except utilities comfortably in positive territory.
The local market has made a strong return from the long weekend, rising for a fifth consecutive session.
Big lift in business confidence
The National Australia Bank (NAB) business conditions index fell from +3.3 points in April to +0.6 points in May.
However, the business confidence index rose from 0.1 points in April to a 10-month high of +7.3 points.
It was the biggest lift in business confidence in almost 6 years.
Petrol price falls
According to the Australian Institute of Petroleum, the national average price of unleaded petrol fell by 2.0 cents in the past week to 143.7 cents a litre. Wholesale prices are near 3½-month lows.
Filling up the car with petrol is the single biggest weekly purchase for most families.
Over the past month motorists in some capital cities have seen pump prices fall by 20-30 cents a litre.
Prices need to stay lower for longer to have a discernibly positive impact on retail spending.
Attractive business conditions
Political certainty combined with tax cuts, rate cuts, the minimum wage decision, lower petrol prices and support for lenders from regulators all point to more attractive business conditions ahead.
The major uncertainty at present is the status of the US-China trade talks.