ASX Today Live News & Analysis

Australia's share market has notched its best two-session performance since April following reports the US and Iran have agreed on the terms of a peace deal.

The S&P/ASX200 jumped 110 points on Monday, up 1.25 per cent, to 8,914, as the broader All Ordinaries gained 121.9 points, or 1.35 per cent, to 9,128.

The memorandum of understanding - expected to be signed by US and Iranian officials in Switzerland on Friday - reportedly includes a 60-day ceasefire extension, the Hormuz Strait reopened within 30 days, and commitments to discuss Iranian sanctions and frozen funds.

Oil prices slumped to 14-week lows, launching most cyclical sectors higher as investors repriced the Persian Gulf conflict's likely global economic impact.

"With oil prices retreating by five per cent and fears of a prolonged energy shock easing, Australian energy stocks bore the brunt of the reversal," Global X senior product and investment strategist Marc Jocum said.

Santos and Karoon Energy dived more than eight per cent each, while Woodside fell 5.7 per cent after denying rumours it was in talks to be scooped up by Exxon.

Local refinery operators Ampol and Viva fell between five and seven per cent, both dipping from recent peaks but still up more than 17 per cent compared to their pre-conflict share prices.

"Elsewhere, animal spirits returned with over 70 per cent of the S&P/ASX 200 stocks finishing in the green in an overwhelmingly risk-on move," Mr Jocum said.

Basic materials, real estate trusts and financials led the move higher, while gold miners shone brightly atop the S&P/ASX200 leaderboard as the precious metal rebounded above $US4,310 ($A6,092) an ounce.

Iron ore and copper giants BHP and Rio Tinto gained more than three and two per cent, respectively, as base metals improved during the session.

Airlines also outperformed, with Virgin Australia shares soaring 12.5 per cent and Qantas up more than six per cent to $9.94 at the prospect of cheaper jet fuel and fewer disruptions for Virgin's Middle East direct flights.

The traditionally defensive consumer staples and utilities sectors fell 0.8 per cent and 1.8 per cent, respectively, as investors unwound some of their recent positioning.

In company news, Chemist Warehouse owner Sigma Healthcare surged six per cent after it scrapped plans to buy UK beauty and pharmacy chain Boots.

The Australian dollar is buying 70.75 US cents, up from 70.33 US cents on Friday at 5pm, buoyed by stronger base metal prices and an easing of the safe-haven greenback.

Ahead of the Reserve Bank's June meeting on Tuesday, markets expected the central bank would hold the cash rate steady at 4.35 per cent, IG market analyst Tony Sycamore said.

"Attention will instead centre on the accompanying statement which is expected to sound hawkish and Governor (Michele) Bullock's press conference for any hints around the likelihood of further tightening later in the year."

ON THE ASX:

The S&P/ASX200 gained 110 points, or 1.25 per cent, to 8,914

The broader All Ordinaries rose by 121.9 points, or 1.35 per cent, to 9,128

The NZX 50 Lost -33.28 points (-0.25%) to 13,360.59 while the Nikkei gained 3297.46 points (4.76%) at the time of writing, to be closed at 69,317.50