European stock markets closed higher Monday as investors digested news of UBS’s takeover of Credit Suisse.

The pan-European Stoxx 600 index was lower in the first hours of trade before moving into positive territory, and closed 1% higher, with all sectors in the green.

Even banks reversed earlier sharp losses to close 1.3% higher. Meanwhile mining stocks were up 2.8% and insurance stocks were up 1.8%.

UBS on Sunday agreed to buy its embattled rival Credit Suisse for 3 billion Swiss francs ($3.2 billion). Following the emergency rescue, the combined bank will have $5 trillion of invested assets, according to UBS.

Credit Suisse shares plunged 56% on Monday, while UBS climbed from losses to a 1.3% gain.

UBS Chairman Colm Kelleher said over the weekend the acquisition is “attractive” for UBS shareholders but that “as far as Credit Suisse is concerned, this is an emergency rescue.”

“In theory, there is no reason for the Credit Suisse crisis to extend, as what triggered the last quake for Credit Suisse was a confidence crisis – which doesn’t concern UBS – a bank outside of the turmoil, with, in addition, ample liquidity and guarantee from the SNB (Swiss National Bank) and the government,” Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, said in a note quoted by Reuters.

Asia-Pacific markets largely fell on Monday, with eyes firmly on the European banking situation.

U.S. stocks were mixed in early trade.

Mining stocks up 3% to lead gains

Mining stocks led gains in European equity markets, with the sector up 3% in the last hour of trading.

Chile-based copper mining company Antofagasta was up 4.9% in late afternoon, followed by British miners Anglo American, which saw a 4.4% uptick.

Source: CNBC