The S&P/ASX200 rose 31.2 points by midday, up 0.36 per cent, to 8,610.9, as the broader All Ordinaries gained 33.9 points, or 0.38 per cent, to 8,912.2.
The bourse had initially slipped below the break-even point but snapped back after the Australian Bureau of Statistics report showed growth held steady in per capita terms and matched an average quarterly growth pace not seen since the end of the COVID‑19 pandemic.
Australian gross domestic product rose 0.4 per cent in the three months to September, lower than consensus forecasts of 0.7 per cent.
But growth for the year to September rose 2.1 per cent - the economy's strongest 12 months since March 2023.
"The fact that today's data shows that Australia's growth is still holding up relatively well is a good signal for the future," AMP deputy chief economist Diana Mousina said.
"We should be confident that our economy is actually in a pretty good shape."
Nine of 11 local stock market sectors were trading higher by lunchtime, as energy stocks continued to rally and as financials rebounded 0.5 per cent from recent selling pressure.
All big four banks traded higher, led by a 1.6 per cent lift in ANZ shares to $34.76, while CBA gained 0.7 per cent to trade at $153.33, continuing to consolidate near eight-month lows.
Elsewhere in the sector, major insurers were broadly lower.
The continued boost to energy stocks came as oil prices held steady as Russia-Ukraine peace talks hit a roadblock over territorial concessions.
Woodside and Santos edged higher, while coal stocks and uranium plays also caught a bid.
Raw materials stocks edged 0.5 per cent higher as BHP (+1.1 per cent) and Fortescue (+0.6 per cent) improved, while Rio Tinto slipped 0.2 per cent as iron ore futures clung onto recent gains to trade above $US107 ($A163) a tonne.
Gold miners were broadly in the red, although Evolution swung higher after underperforming on Tuesday, as the precious metal eased to $US4,218 ($A6,422) an ounce.
Bellevue Gold was the top-200's best performer, soaring five per cent
Real estate stocks rallied on the back of the GDP data release, surging one per cent and with standout performances from Charter Hall, Stockland and Vicinity Centres, which all rose more than 1.5 per cent.
Australia's tech sector slipped slightly lower, as fintech Block and cloud network play Megaport clocked the biggest drops of the top-200, tumbling more than five per cent each.
In company news, Vulcan Energy was placed in a trading halt as it finalised a €2.2 billion ($A3.9 billion) funding plan to build its Phase One Lionheart lithium and renewable energy project in Germany.
The Australian dollar fell from seven-week highs to buy 65.69 US cents, slipping in the wake of the GDP print, but still up from 65.53 US cents on Tuesday at 5pm.
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