Australian shares inch higher as energy stocks rally

Energy stocks outperformed the bourse, up 1.7 per cent as oil prices hit seven-week highs after the US and Iran exchanged tit-for-tat strikes at the weekend.

Major miners helped support the bourse, with BHP, Rio Tinto and Fortescue lifting after China flagged a $US54 billion ($A75 billion) injection into state banks and insurers to shore up its financial sector.

The Australian dollar is buying 72.09 US cents, up from 72.04 US cents on Friday at 5pm.