* Banks, miners lead rally on Monday
* Newcrest Mining, Evolution, LNG and Karoon among top gainers
* Index in positive territory for first time since July-end
* 186 shares up, 6 down and 8 unchanged (Adds analysis, quotes, stocks on the move)
By Swati Pandey and Cecile Lefort
SYDNEY/WELLINGTON, Oct 5 (Reuters) - Australian shares rallied 1.7 percent on Monday led by gains in U.S stocks while positive local job advertising figures helped boost investor confidence in the health of the economy, with hefty gains in banks and resources counters.
Trading volumes are expected to be weaker with almost half the country on a public holiday.
The S&P/ASX 200 index .AXJO jumped 86.08 points to 5,138.1 by 0117 GMT. The benchmark fell 1.8 percent on Friday.
The index fell for two straight months to September hitting a 2-year trough and forcing most market strategists to slash their year-end expectations. A new Reuters poll shows the index is still seen ending 2015 roughly 3 percent above Friday's close. ID:L4N11O14O
Technically, the market is now moving towards positive territory for the first time since end of July, said James McGlew, executive director of corporate stockbroking at Argonaut.
"There is an enormous support coming in at 4800-5000 points. Last month alone we've tested 5,000 points on eight occasions and every time it is breached we've seen strong bounce back from there," he added.
A monthly survey by Australia and New Zealand Banking Group ANZ.AX showed total job advertisements rose 3.9 percent to 153,778 per week on average in September. ID:nS9N0YI00O
Gold miners such as Newcrest NCM.AX and Evolution EVN.AX rallied 10.7 percent and 7.5 percent after the precious metal retained gains from its biggest daily jump in nearly nine months.
Energy-related shares such as LNG LNG.AX , Karoon Gas KAR.AX and Drillsearch DLS.AX surged 4-12 percent.
Major banks including ANZ and Commonwealth Bank CBA.AX rose between 1 and 1.7 percent while top miners BHP Billiton (LONDON:BLT) BHP.AX and Rio Tinto (LONDON:RIO) RIO.AX were up 3.4 and 1.9 percent respectively.
For more individual stocks activity click on STXBZ
New Zealand's benchmark NZX 50 index .NZ50 rose 0.6 percent or 34.73 points to 5,628.24, pulling away from a one-month low touched last week.
Telecommunications and utilities led gains with Auckland International Airport AIA.NZ up 1.8 percent. Power firm Vector added 1.6 percent, while telecom company Spark New Zealand SPK.NZ rose 1.1 percent.
"We should get continued support for yield stocks and it may only be exacerbated by another rate cut by the Reserve Bank of New Zealand at the end of the month," said James Smalley, a director Hamilton Hindin Greene.
He cited defensive sectors such as infrastructure and property as likely gainers thanks to their 8 percent to 9 percent dividend yields.
The RBNZ holds its monthly policy review on Oct 29 and economists forecast an easing to 2.5 percent. ID:nL3N12152M