SYDNEY May 13 Australian shares rose to a two-week high on Tuesday morning, spurred by broad-based gains after Wall Street notched up another record high and base metals firmed.
Investors were also looking ahead to the first budget from the conservative coalition government of Prime Minister Tony Abbott later in the day, with big spending cuts forecast, along with tax hikes and spending on infrastructure.
"With the amount of pre-marketing clocked up by the Treasurer, local markets will be relieved to have access to the facts and we might be able to respond naturally to US and European market momentum, which began to lift this week," Scott Schuberg, chief executive at Rivkin Securities sait in a note.
The S&P/ASX 200 index gained 0.8 percent, or 43.9 points, to 5,492.3 by 0144 GMT, after earlier touching the highest level since April 30. The benchmark dipped 0.2 percent to 5,448.4 on Monday.
The Australian market took its cues from Wall Street, where the Dow and S&P 500 ended at record highs overnight and the Nasdaq rallied on Internet and biotech shares.
Miners led the gains, with BHP Billiton Ltd and Rio Tinto Ltd climbing 2.5 percent and 3.2 percent respectively.
Investors will likely be watching out for industrial production, fixed asset investment and retail sales data from China, Australia's biggest export market as Asia's economic powerhouse experiences its slowest growth in decades.
Australia's big four banks, which fell in the past week on profit-taking, were trading up. Commonwealth Bank of Australian rose 0.6 percent and Westpac Banking Corp climbed 0.7 percent.
Consumer related stocks rebounded, as supermarket chain Woolworths Ltd up 0.6 percent and Coles-owner Wesfarmers Ltd 0.9 percent higher.
Takeover activity also attracted interest in early trade.
Leighton Holdings Ltd rose 1.8 percent after majority holder Hochtief raised its stake in the firm to nearly 70 percent, tightening its grip on Australia's biggest construction company and paving the way for its restructuring.
Australian copper miner PanAust Ltd surged 33.5 percent after it said it received an incomplete takeover offer from China's state-owned Guangdong Rising Assets Management
On the other hand, GPT Group slipped 2.7 percent after GIC Private, the international investment arm of the Singapore government, put about an 8 percent stake in GPT for sale.
Shares in Orica Ltd fell as much as 4.4 percent, after the explosives maker reported a 9 percent drop in its first-half net profit.
New Zealand's benchmark NZX 50 index rose 0.6 percent to 5,193.5.
(Reporting by Maggie Lu Yueyang; Editing by Shri Navaratnam)