Westpac has become the latest stock to top $100 billion in market capitalisation, as the big banks led a broad-based share market rally.

The benchmark S&P/ASX200 jumped 86.2 points, or 1.7 per cent, to 5102.4, its biggest one day gain in more than a month as investors bet that lower than expected inflation data would trigger another rate cut by the Reserve Bank. The broader All Ordinaries added 81.6 points, or 1.6 per cent, to 5084.2.

Banks were in demand today as investors chased higher-yielding stocks.

The financial sector was the biggest driver on the market, surging 2.1 per cent, as investors chased higher-yielding stocks.

Westpac is just the third company after BHP Billiton and CBA to be worth more than $100 billion, with its market capitalisation reaching $100.9 billion after the day’s rally. Westpac shares pushed up 2.5 per cent to $32.50, a record high.