The S&P/ASX200 ended Tuesday's trading session up 24.7 points, or 0.28 per cent, to 8,877.7, as the broader All Ordinaries gained 30.3 points, or 0.33 per cent, to 9,151.2.
The local market followed Wall Street's lead after it reached fresh highs powered by tech stocks in anticipation the Federal Reserve will cut interest rates, Capital.com senior financial markets analyst Kyle Rodda said.
"Wall Street is rallying into this Fed decision, and it's doing so on the expectation that there will not just be a rate cut, but a guidance towards future rate cuts as well," he told AAP.
"It's pretty much all about the Fed at the moment. We'll count down the minutes until that happens and then react accordingly."
He said the local market had been "far from volatile recently" and any guidance from Fed chair Jerome Powell that failed to match dovish expectations could be the "shock that wakes up the markets".
Eight of 11 local sectors ended the day in positive territory, led by energy and materials while healthcare lagged.
Mining stocks ended trading up 0.7 per cent, as gold stocks benefited from anticipation surrounding the US rates decision, hitting a fresh high of $3689.
Goldminers Northern Star and Evolution Mining both gained 0.5 per cent while Perseus Mining was 1.4 per cent in the green.Â
Also ahead were the sector's heavyweights; BHP was up 0.5 per cent and Rio Tinto rose 1.9 per cent.
Energy gained 0.9 per cent amid heightened fears of supply disruptions overseas, with coal miner New Hope recording a 5.1 per cent gain despite reporting an eight per cent drop in annual profit.
Healthcare trailed after CSL recorded a 1.3 per cent slump on the announcement of a deal to potentially acquire Dutch biotech company VarmX BV, which is developing a treatment for a deadly side effect of blood thinners.
The Australian biotech giant will make an upfront payment of $US117 million ($A175 million) for the company, weeks after it announced 3000 job cuts and spun off its vaccine arm.
Super Retail Group, which owns Rebel Sport and Supercheap Auto, fired its chief executive and managing director on Tuesday following revelations of an undeclared workplace relationship.
Anthony Heraghty's termination over his relationship with the company's former chief human resources officer led to a 4.3 per cent share price drop, but the controversy didn't spread to the wider consumer discretionary sector which was up 0.8 per cent.
Financial stocks ended the day in the green but recorded mixed results among the big four banks, with Westpac and NAB in positive territory while ANZ and CBA lost ground.
The Australian dollar is buying 66.65 US cents, up from 66.57 US cents on Monday at 5pm.
ON THE ASX:
* The S&P/ASX200 rose 24.7 points on Tuesday, or 0.28 per cent, to 8,877.7
* The broader All Ordinaries gained 30.3 points, or 0.33 per cent, to 9,151.2
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 66.65 US cents, from 66.57 US cents on Monday
* 97.94 Japanese yen, from 98.22 Japanese yen
* 56.57 euro cents, from 56.78 euro cents
* 48.92 British pence, from 49.09 British pence
* 111.67 NZ cents, from 111.78 NZ cents
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