THE Australian stock market was higher in early trade, as gains in base metals and oil prices boosted the resources sector.

The benchmark S&P/ASX200 index was 32.7 points higher at 6356.3, while the All Ordinaries had gained 31.8 points to 6419.8.

On the Sydney Futures Exchange, the March share price index contract was up 31 points to 6372, on a volume of 1,059 contracts.

“Overall I expect the market to perform okay and hold up its recent gains,” CMC Markets senior dealer Dominic Vaughan said.

“They’re relatively broadly based gains – oil is up and metal prices are up and we have stability in the US. We’re seeing a little stability on global equities markets and it’s flowing through locally.”

US crude and refined products futures rose sharply overnight, lifted by another Turkish raid on northern Iraq and expectations that weekly oil inventory data will show supplies fell last week.

On the New York Mercantile Exchange, February crude rose $US1.84, or 2 per cent, to settle at $US95.97 a barrel.

That helped Australian oil stocks. Santos surged 45 cents, or 3.42 per cent, to $13.61 and Woodside Petroleum was up 80c to $48.80.

The bellwether resource stocks also were higher.

Rio Tinto was up $2.01 to $134.45 and BHP had gained 74c to $41.26.

The banks also enjoyed gains, with Westpac finding 17c to $28.17, National Australia Bank gaining 39c to $38.24, ANZ up 13c to $27.40 and Commonwealth Bank rising 45c to $58.54.

US stocks ended slightly ahead overnight, on account of strong oil stocks as the retail sector weighed down Wall Street after Target lowered its sales forecast.

The Dow Jones industrial average was up 2.36 points, or 0.02 per cent, to end at 13,551.69. The Standard & Poor’s 500 Index was up 1.21 points, or 0.08 per cent, to finish at 1497.66 and the Nasdaq was up 10.91 points, or 0.40 per cent, to 2724.41.

The spot price of gold was $US824.50, rising $US15.00 from Monday’s closing Sydney price of $US809.50.

The gold miners enjoyed strong gains, with Newcrest Mining up 70c, or 2.28 per cent, to $31.35. Newmont rose 4c to $5.66 and Lihir gained 6c to $3.48.

Phone giant Telstra was steady at $4.75.

AAP