Australian shares have rebounded from last week's negative volatility, following a massive rally on Wall Street and European markets.

The benchmark ASX 200 closed 1.1 per cent higher at 5,683 — a slight retreat from its 1.7 per cent jump earlier in the day.

The broader All Ordinaries index lifted by a similar amount to 5,745 points.

Meanwhile, the Australian dollar rose slightly to 71.3 US cents at 4:00pm (AEDT). Over the weekend, it bounced back from a flash crash, which briefly took the dollar to a 10-year low of 67.3 US cents.

The best performing stocks on the ASX 200 included mining equipment company Emeco Holdings (+10.3pc), Syrah Resources (+9.5pc) and Sandfire Resources (+9pc).

Nine (+6.1pc), Bluescope Steel (+5.1pc), Santos (+4.3pc) and AMP (+3.9pc) were some of the big-name stocks driving the local market higher.

On the flipside, hospital operator Healius (-6.2pc) — formerly trading as Primary Health Care — after it rejected a $2 billion takeover offer from its largest shareholder, Jangho Hong Kong Holdings.

Mining giants BHP and Rio Tinto lifted 3 and 2.7 per cent respectively.

The major banks have also posted solid gains, rising between 0.8 per cent (Westpac) and 1.4 per cent (ANZ).

Technology was the best performing sector, driven up by Afterpay (+6.8pc) and Wisetech Global (+5.3pc).

Most sectors traded higher, with resources (+2.5pc) and energy (+2.4pc) being the next strongest performers.

Job figures and Fed's rate comments boost market

Global markets tanked last week after Apple issued a rare profit warning — as it blamed the weakening Chinese economy, rising US-China trade tensions and less people upgrading to new iPhones for its lowered expectations on first-quarter revenue.

However, that sell-off turned out to be short-lived as US and European markets more than recovered their losses on Friday (New York time).

Wall Street's main indices surged — between 3.3 per cent (Dow Jones) and 4.3 per cent (Nasdaq) — after figures from the Labor Department showed the number of new jobs created in America was almost double what had been expected.

The benchmark S&P 500 also lifted strongly by 3.4 per cent.

The US economy created 312,000 new jobs in December, while economists had been expecting 176,000.

Also re-igniting the bullish sentiment were comments from Federal Reserve chairman Jerome Powell, asserting the central bank's independence.

Mr Powell, speaking on an America Economic Associations panel, said he would not resign if US President Donald Trump asked him to.

"If the President asked you to resign, would you do it?" asked Neil Irwin, the panel moderator from the New York Times.

The Fed chairman simply replied: "No."

Market volatility was compounded in December over reports that Mr Trump was thinking of firing the Fed chair, forcing his advisors to reassure investors that Mr Powell's job was "100 per cent safe".

The Friday surge in markets was also due to reassurances from Mr Powell about upcoming interest rate hikes.

Mr Powell said the Fed would be "patient" and flexible in its approach to rate increases — soothing fears that the US central bank might be raising borrowing costs too quickly.

"Equity markets usually struggle as cash becomes tighter during a Fed rate hike cycle triggering investors to reduce risk," said Stephen Innes, head of Asia-Pacific trading at OANDA.

He also said "the emotional market meltdown in the fourth quarter" and "tightened financial conditions" means the the Fed will likely hold off on any rate hikes until at least mid-2019.

European markets also soared on Friday, particularly London (+2.2pc), Frankfurt (+3.4pc) and Paris (+2.7pc).