SYDNEY (AFP) -- Australian share prices closed 0.86 percent higher Wednesday, supported by bargain-hunting in the resources stocks after recent heavy losses, dealers said.

Market leaders BHP Billiton and Rio Tinto staged significant recoveries on the view that they had fallen to relatively low levels given their still strong earnings prospects.

The benchmark SP/ASX 200 added 42.8 points at 5,017.2, recovering the key 5,000 points level while the broader All Ordinaries index ended up 39.8 points at 4,978.6.

Turnover was 1.11 billion shares worth 4.77 billion dollars (3.5 billion U.S.), with gains leading declines 630 to 468 while 320 stocks were unchanged.

Bell Potter private client advisor Stuart Smith said trading Wednesday was a reversal of Tuesday with the resources sector in focus rather than the banks.

Nevertheless, the banking sector managed to end largely in positive territory, making late session gains after trading in the red for much of the day, he said.

National Australia Bank added 0.20 to 36.40, Commonwealth Bank rose 0.15 to 46.10 Westpac gained 0.05 to 23.33 but ANZ fell 0.02 to 27.22.