The S&P/ASX200 spiked more than 0.7 per cent to a new high of 9,213 points in early trade, topping its previous record of 9,202.9 set in late February just days before US-led attacks on Iran sparked a conflict that roiled energy markets and lit a match under global inflation expectations.
By midday, the top-200's gain had eased to a 18.3 point advance, up 0.22 per cent to 9,165.7, while the broader All Ordinaries had improved by 34.2 points, or 0.37 per cent, to 9,346.1, stalling roughly 50 points short of its own intraday peak.
The raw materials sector led the market with a 2.5 per cent jump as investors piled into recently under-pressure miners, while the major banks weighed as the financials sector dropped one per cent after briefly topping its own record.
Commonwealth Bank led the big four banks lower with a 2.4 per cent dip to $176.34, after it rallied more than 15 per cent in eight weeks from June's lows.
"The milestone follows a strong end to July that saw the index finish the month 2.3 per cent higher, with a 5.84 per cent gain in the financials sector accounting for the majority of the ASX200's July gains," IG analyst Tony Sycamore said.
Softer-than-expected inflation data a week earlier, and a recent measured tone from Reserve Bank governor Michele Bullock had also boosted confidence, while the ASX200's reputation as a less volatile index had also supported inflows, Mr Sycamore said.
"With reporting season set to pick up speed next week, and the usual mix of beats and misses expected, we expect a volatile few weeks ahead," he said.
The energy sector fell almost two per cent as oil prices dipped to three-week lows on reports the US and Iran are closing-in on a deal to de-escalate fighting and reopen the Strait of Hormuz, a choke-point for a fifth of global oil supplies.
Woodside and Santos fell roughly three per cent and two per cent respectively, while refinery operators Ampol and Viva Energy each lost more than 1.2 per cent.
Coal miners also traded lower, while uranium stocks rallied after a strong performance from US tech stocks on renewed confidence in the artificial intelligence and data build-out trade.
Consumer-facing stocks were mixed as cyclicals rose 0.6 per cent, while staples fell by a similar magnitude as Dan Murphy's and BWS owner Endeavour dipped 1.8 per cent after flagging a 14.7 per cent drop in full-year profit.
The Australian dollar is buying 70.43 US cents, up from 70.14 US cents on Tuesday at 5pm AEST.
