The Australian share market is set to surge again, having just recorded its best ever day following the announcement of a $130 billion wage subsidy package for businesses.

The SPI200 futures contract was up 66 points, or 1.27 per cent, at 5,257.0 points at 0800 AEDT on Tuesday, suggesting strong early gains for local stocks.

The S&P/ASX200 benchmark index finished Monday up 399 points – a record 7.0 per cent – after the government announced new stimulus to help businesses through the coronavirus pandemic.

In an unprecedented move, employees will receive a flat-rate payment of $1500 per fortnight through their employers in a bid to lessen the economic blow caused by COVID-19.

The payment amounts to about 70 per cent of the median wage.

The treasurer says about 60,000 businesses had already signed up for the scheme announced on Monday, on the tax office website.

The local market has fallen by as much as 39 per cent from peak to trough during the virus pandemic but is now up 18 per cent since hitting a seven-year low eight days ago.

IG Markets’ Kyle Rodda said local markets were a long way from being out of the woods yet, but green shoots were emerging.

“The future is still too uncertain for anyone to make any sort of pronouncement that markets are “risk-on”,” Rodda said in a note.

“However, as stocks begin the new week higher, there’s hope in some corners of the market a bottom for stocks is “in”.”

Wall Street also rose overnight after US President Donald Trump followed his own stimulus measures by extending stay-at-home guidelines.

The Australian dollar was buying 61.68 US cents at 0700 AEDT, up from 61.47 US cents as the market closed on Monday.