The Australian sharemarket has reached a new 20-month closing high, after a record half-year profit result from Commonwealth Bank boosted already surging sentiment.

At the close, the benchmark S&P/ASX 200 index had shot up 53.9 points, or 0.94 per cent, to 5,809.1, while the broader All Ordinaries index had bounded 48.2 points, or 0.83 per cent, to 5,859.1.

It represents the highest closing mark for the benchmark index since May 2015.

Driving the strong showing was news of better-than-expected profit readings from CBA and conglomerate Wesfarmers.

“When two of the market heavyweights beat expectations, it makes it difficult for the overall market not to respond positively,” Atlantic Pacific Securities client adviser Gary Huxtable said.

“The gains in the financials and Wesfarmers have been able to offset continued underperformance in bond proxies.”

Mr Huxtable added the market was well-positioned to press forward in coming days in the wake of a volatile session on Tuesday.

“As some of the short-term profit takers were washed out yesterday, we’re likely to continue to follow through for new highs from here,” he said.