Australian shares rose on Monday, following an upbeat US non-farm payroll report showing the strengthening of the US labor market.

The S&P/ASX 200 jumped nearly 0.7% or 55.4 points to close at 8,205.40.

The US non-farm payroll rose by 254,000 in September, with the unemployment rate falling to 4.1% from 4.2%, confirming the resiliency of the country's economy, Reuters reported.

"The reaction in markets conveys what the key themes and risks for market participants are presently: economic growth, and its impact - for equities - on future earnings," said Kyle Rodda, Capital.com's senior financial market analyst.

"There's also seemingly a revival of the U.S. economic exceptionalism trade," Rodda added.

On the corporate front, Arcadium Lithium (ASX:LTM) confirmed that it has been approached by Rio Tinto (ASX:RIO) regarding a potential takeover. However, the approach is non-binding, and there is no certainty that any transaction will occur. At market close, Arcadium Lithium's shares surged 46%, while Rio Tinto's shares slid 2%.

Meanwhile, Rio Tinto (ASX:RIO)-owned Energy Resources of Australia (ASX:ERA) said the Australian Takeovers Panel will conduct proceedings relating to its around AU$880 million equity raise. Zentree Investments and Packer & Co. had applied to review the Panel's previous decision not to conduct proceedings. Its shares jumped 10% at market close.

Lastly, West African Resources' (ASX:WAF) shares closed down 20% after the mining firm said it is "not aware of any plans by the government of Burkina Faso to withdraw any of its mining permits" amid fears over the status of its gold mining operations in the country.