* Global COVID-19 cases, lockdowns continue to worry investors
* AMP boosts Australian financial index on premium takeover offer
* Gold stocks gain on stronger bullion prices
* China Oct factory activity grows fastest in nearly 10 years (Updates to close)
By Nikhil Subba
Nov 2 (Reuters) - Australian shares closed higher on a cautious note, as traders braced for restlessness during the U.S. Presidential election week, while gold stocks led the gains as uncertainty stoked bids for the safe-haven metal on Monday.
The S&P/ASX 200 index .AXJO closed up 0.4% at 5,951.30, following a 0.6% slide on Friday.
Global markets await the hotly contested U.S. election, with Democrat Joe Biden holding a commanding national lead over President Donald Trump. Nevertheless, Trump has stayed competitive in the swing states that could decide the White House race.
"Some attention turning to the outcome of who will hold the Senate, as a Biden White House without Democratic control of the Senate could still mean difficulty for already slow progress in a new fiscal stimulus package to pass," said James Tao, market analyst at CommSec.
Wall Street, along with global markets, have wildly swung in volatility in the weeks building up to the U.S. election over implementation of a stimulus deal to revive the pandemic-battered economy.
However, markets received some cheer after data from China signalled that factory activity in October had expanded at its fastest pace in a decade. the home front, the Australian gold index .AXGD gained 1.1%, helped by a rise in bullion prices, as increased global uncertainty drew investors to the safety of gold.
Catalyst Metals CYL.AX rose 6.1% while Bellevue Gold BGL.AX advanced 4%.
The heavyweight financial sector .AXFJ gained 0.4% after the country's second-largest lender Westpac WBC.AX posted full-year results and said it intends to return to a half-yearly dividend cycle. Bank announced this morning it intends the resume dividends. This is a positive for financials today," Smoling said.
AMP Ltd AMP.AX jumped 10% after the wealth manager said the proposed takeover offer from Ares Management ARES.N implied a 21% premium to Friday's closing price.
New Zealand's benchmark S&P/NZX 50 index .NZ50 slipped 0.1% to 12,070.83.
Heartland Group Holdings HGH.NZ slid 5.2% while Pacific Edge PEB.NZ shed 4.2%.