Why the Australian stock market has reached a six-year high?

The Australian share market on Thursday pushed again to continue its six-year high passing its previous high reached on July 31, 2008 after the global financial crisis.

The benchmark S&P/ASX200 index inched up 4.3 points, or 0.1 percent, to 5638.9, while the broader All Ords added 4.8 points, or 0.1 percent, to 5634.0.

Over the past 12 months, the Australian stock market has enjoyed a bullish trend with investors turning away from bank deposits and bonds to high-performing stocks.

Patersons Securities strategist Tony Farnham said the boom in the Australian stock market was caused by record-low bank interest rates, which was pushing investors away from traditional bank deposits and into the share market.

"Investors are looking at the 3 percent they can get if they keep their money in the bank, or the 4 to 5 percent they can invest in the bank itself," he told Xinhua.

"People are chasing yields, from the banks to resource stocks."

The Reserve Bank of Australia, which has set a base interest rate of 2.5 percent for more than a year, said Australian banks are taking advantage of low-cost wholesale international funding and discounting variable-rate loans as well as cutting rates on fixed-term mortgages. But this in turn lowers the deposit rates and continues to drive investment in stocks.

In the face of rising unemployment and fluctuating consumer sentiment the RBA said the low interest rate looks certain to continue through 2014.

"Overall, cumulative movements in interest rates since the start of the year amounted to a noticeable easing in financial conditions," the central bank said.

"Financial markets continued to expect the bank to leave the cash rate target unchanged at the August meeting and over the year ahead."

With this low-interest outlook, stock market watchers expect the Australian market to continue its upward path.

Overseas markets also influence the performance of the Australian stock exchange, especially in the United States.

Recently there have been positive leads from the U.S.market, which have flow-on benefits in Australia. On Wall Street on Wednesday, stocks lifted amid more sign of an improvement in the U. S. economy. The Dow Jones Industrial Average rose 59.54 points, or 0.35 percent, to 16,979.13 points.

As a result, the Australian market rose again, as it does when Wall Street rallies.

The U.S. Federal Reserve on Wednesday said it intended to keep the benchmark interest rate low for a "considerable period of time, " making stocks attractive. It's a similar position the RBA is taking locally, with analysts expecting low rates to continue well into 2015.

With the assurance of low interest rates in Australia, this will continue to make stocks attractive in Australia, too.

The Chinese economy is another influence on the Australian market. The RBA said that in China, GDP growth in the June quarter was consistent with the authorities' target for a growth of 7.5 percent in 2014 as a whole. The recent improvement in growth was driven by a rebound in exports and a pick-up in investment growth, which partly reflected the effect of modest stimulus measures.

Thursday's trading showed how China's economic trends have an impact on Australian shares. Although the share market closed higher for a sixth straight session, it ended well off the day's highs after softer than expected Chinese manufacturing data.

Domestically, the overall company reporting season in the last few weeks has been mainly positive, encouraging more investment into the market.

Telecoms, consumer and healthcare companies are leading the way followed by resource firms.

Farnham said the property market was also strong with an increasing number of investors entering the market. "If you look at housing lending, a significant proportion are investors," he said.

The strong housing market has helped Australian home lender Mortgage Choice deliver its best financial results ever with a record number of loan settlements.

The lender's net profit rose 5.8 per cent to 19.8 million Australian dollars (18.3 million U.S. dollars) in the year to June 30.

"The property market remains strong, with dwelling values on the rise and auction clearance rates continuing to hover at solid levels," the company said.

"Further, home loan approvals have hit a new high, which is reflected in the group's strong home loan approval growth."

Property developer Mirvac on Thursday announced that its full year profit spike 220 percent to 447 million Australian dollars ( 413.5 million U.S. dollars).

The company said it was focused on building apartments to feed what it believes will continue to be high demand, particularly in Sydney and Melbourne.

The RBA said the Australian stock market's record highest levels were driven in particular by rises in share prices of the large resource companies.

Farnham said the big resource companies, such as BHP and Rio Tinto, were winding back capital expenditure, "getting their houses in order" and increasing dividends.

He said despite the fall in iron ore and coal prices, the major resource players were significantly increasing the volumes of shipments to Australia's major customers, especially China, which is the nation's biggest trading partner.