(Adds analysis, quotes, stocks on the move)
SYDNEY, March 5 (Reuters) - Australian shares rose 0.6 percent on Wednesday morning, spurred by upbeat fourth quarter GDP figures and on signs a military confrontation between Russia and Ukraine might be averted.
Overnight, the S&P 500 jumped 1.5 percent to a record high, after Russian President Vladimir Putin said Russia reserved the right to use all options to protect compatriots who were living in "terror" in Ukraine, but that force was not needed for now.
The Australian market got a further boost from data showing the economy grew a solid 0.8 percent last quarter as a surge in resource exports and a pick up in consumer spending helped offset a sharp pullback in business investment.
"The Australian economy is still motoring along and the economy is weathering the mining investment downturn, reasonably well," said Shane Oliver, head of investment strategy at AMP Capital Investors.
"There's a slump occurring in investment but that's being offset by consumer spending, housing activity and trade."
The S&P/ASX 200 index added 33.8 points to 5,434.0 by 0127 GMT, its biggest one-day gain in nearly three weeks. The benchmark is hovering some 30 points below the 5-1/2 year peak of 5,461.7 points hit on February 25.
All 'Big Four' banks rose, with Westpac Banking Corp climbing 1.1 percent and Commonwealth Bank of Australia tacking on 0.7 percent. Mid-tier Bank of Queensland Ltd added 0.5 percent.
In the consumer space, retail department stores Myer Holdings Ltd and David Jones Ltd climbed 1.5 percent and 1.7 percent, respectively.
Analysts said easing tensions in Ukraine steered investors back into equities after several days on the sidelines as Russian actions raised fears of a military conflict.
"What we saw on the weekend could be the first move in a very long game of chess, so I don't think we'll be as concerned about this being an imminent threat to markets," noted Scott Schuberg, CEO of Rivkin Securities in Sydney.
Gold was the only sector that faltered, as investors pulled out of the safe-haven commodity after bullion prices dipped about 1 percent overnight. Australia's top gold producer Newcrest Mining Ltd fell 0.6 percent, while Resolute Mining Ltd lost 0.8 percent.
Celsius Coal Ltd soared 11 percent after the company confirmed it had reached non-binding agreements to sell coal from its mine in Kyrgyzstan to Baoshan Iron & Steel and China Minmetals.
Icar Asia Ltd rallied 13.5 percent to all-time highs of A$1.30 after Carsales.com Ltd acquired an additional 3 percent of the company.
New Zealand's benchmark NZX 50 index continued its rally to add 0.8 percent, touching all-time highs of 5,072.7.
(Reporting by Thuy Ong; Editing by Shri Navaratnam)