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TORONTO: The Canadian dollar was up more than 1.5 cents in international trading as markets react positively to news of a massive package to protect the embattled euro and contain the European debt crisis.

The dollar was trading at around 97.60 US after the European Union and the International Monetary Fund pledged nearly $1 trillion to contain the debt crisis and defend the euro.

The loonie lost 2.64 cents to end Friday at 95.8 cents US and had dropped as low as 93.02 cents in hectic trading on Thursday.

The dollar and commodities were hammered last week as the European debt crisis saw investors pile into the safe haven status of the U.S. dollar.

Overseas markets were also up sharply, with both the German and London stock markets up well over 200 points each, or more than four per cent.

The Hang Seng Index in Hong Kong is up more than 500 points and Japan's Nikkei Index has gain more than 150 points.