The benchmark S&P/ASX 200 index rose 1.5% to 6,684.20 points at the close of trade, marking its best day since Nov. 24.
Gold stocks led gains among the sub-sectors, rising over 5%, as bullion prices hit an eight-week high amid a spike in global COVID-19 cases and prospects of tougher coronavirus control measures.
Heavyweights Evolution Mining, Newcrest Mining and Northern Star Resources gained between 3% to 4%.
Miners notched up a 2.7% climb, as iron ore prices extended their bull run into the new year, jumping more than 3% buoyed by tight supply and robust demand.
Fortescue Metals Group gained 4.8% to hit a fresh record high, while Rio Tinto added as much as 1.3%.
However, shares of business support services provider Link Administration plunged about 14% after U.S.-based SS&C Technology Holdings shelved its A$3.02 billion ($2.32 billion) buyout offer.
New Zealand markets were closed for a public holiday.