The S & P/ASX200 rose 0.3 per cent, or 19.2 points, to reach 6997. Earlier in trading the benchmark eclipsed the 7000 threshold which it has been below since October 18. The broader All Ordinaries rose 0.2 per cent to 7.192.3 at the closing bell.

Eight of 11 sectors finished in the green, with health care stocks the strongest gainers rising 1.5 per cent. Resmed and Fisher & Paykel both rose 3.1 per cent, to finish at $23.87 and $20.77, respectively.

Energy stocks were the worst performers, dropping 1 per cent through the trading session.

Markets are pricing in a near 70 per cent chance that the RBA will raise rates to 4.35 per cent for the first time in five months when it hands down its November board decision at 2.30pm on Tuesday.

Saxo Markets strategist Charu Chanana said if the central bank didn’t follow through with a rate hike, the credibility of new RBA governor Michele Bullock could be tarnished.

“The RBA has said its tolerance for inflation overshooting the target is low and inflation did come in above expectations, and housing prices are also jumping higher,” Ms Charu said.

“The RBA has also been lagging some of the other central banks in its rate-hiking cycle, so I think this is really the time they can act.”

In company news, Origin Energy, which is faced with a takeover offer from a Brookfield-led consortium, rose 1.9 per cent to $8.45. AustralianSuper, the utility giant’s largest shareholder, increased its stake to 15.03 per cent and intends to vote against the takeover bid.

After delivering its annual results which showed a 26 per cent rise in profit and announcing a $1.5bn share buyback, Westpac shares jumped 2 per cent to $21.92. The rest of the big four banks climbed between 0.5 and 1 per cent.

After rallying more than 20 per cent on Friday, Afterpay parent company Block fell 6.45 per cent to $76.10.

Iress was the top gainer, increasing 8.3 per cent to $5.64 after JP Morgan analysts upgraded the financial software developer to overweight.