Shares have risen following the eurozone's agreement designed to resolve the Greek debt crisis.
UK and French markets gained more than 1% in morning trading, before slipping slightly, with the FTSE 100 index ending up 0.6% and the Cac 0.7% higher.
Eurozone leaders agreed a new package worth 109bn euros ($155bn, £96.3bn).
Private lenders will also be asked to contribute and, as a result, the Fitch ratings agency said it would consider Greece in "restricted default".
Japan's main Nikkei share index had earlier closed up 1.2%.
US stocks ended Friday trading in New York mixed, with the main Dow Jones index down 0.3%. However, analysts said Wall Street investors were more focused on the US's own debt problems.
The euro was on Friday trading at $1.4369, down from $1.4439 immediately following Thursday's deal announcement.
One of the key terms of the new eurozone package is that it lowers the interest rates that Greece and the other two countries that have received bail-outs - Portugal and the Irish Republic - have to pay.
The UK announced on Friday that it would follow suit and lower the interest rate that the Irish Republic has to pay on the £3.2bn loan it gave to the Irish government last year.
Speaking on Friday, German Chancellor Angela Merkel hailed the eurozone accord and said it was her country's duty to support the single European currency.
"It is our historical duty to support the euro," Mrs Merkel said.
"The euro is good for us, the euro is part of Germany's economic success, and a Europe without the euro is unthinkable."
Relief at the deal offset any concerns about banks losing out as a result the planned debt restructuring.
"The deal removes one of the concerns related to the overall market... and EU finance ministers understand the risk associated with a possible default and that they're willing to step up and support weaker countries," said Robert Pavlik, a strategist at Banyan Partners in Florida.
Bond yields, which reflect the risk investors attach to government debt, fell across the eurozone in morning trading, particularly those in Greece and Portugal. However, yields then rose again in the afternoon.
Greece's Finance Minister Evangelos Venizelos said the deal would provide "great relief for the Greek economy".
The eurozone agreement is a comprehensive package designed not only to resolve Greece's debt crisis but to prevent contagion to other European economies, thereby shoring up the euro in the process.
The package includes:
- 109bn euros in new loans to Greece
- Various options to extend Greece's repayment terms and reduce the amount it repays on existing loans
- Voluntary private sector participation in these options, so that banks share taxpayers' burden
- Doubling the length of repayment terms for the Irish Republic and Portugal, both of which have received financial assistance previously
- Additional powers granted to the European Financial Stability Facility to buy up bonds and to make credit available to countries such as Spain and Italy that are not at immediate risk of insolvency.
The Institute of International Finance (IIF) - a global trade body representing big banks and other major lenders - said the planned debt restructuring would target participation by 90% of Greece's private sector lenders.
French President Nicolas Sarkozy said private lenders would contribute a total of 135bn euros of financing to Greece.
This is expected to provide some 50bn euros of debt relief to Greece.
Three of the four options offered to lenders to swap or relend existing debts would extend Greece's repayment terms by 30 years, while the fourth would do so by 15 years.
They all offer a much lower interest rate than Greece's current 15%-25% cost of borrowing in financial markets.
Two of the options would also involve "haircuts" - reducing the amount of debt Greece has to repay.
The terms of the deal imply a loss to Greece's lenders equivalent to 21% of the market value of their debts, said the IIF.
But because the contributions are "expressly voluntary", the International Swaps and Derivatives Association said that the deal should not trigger payments on default-swaps designed to protect against a default.
Fitch ratings agency said it would consider Greece to have defaulted on its debts once old bonds had been swapped for new bonds.
Although the agency welcomed the agreement as a positive step, it said it would have no choice but to declare a default once the swap had been made.
"An exchange that offers new securities with terms that are worse than the original contractual terms of the existing debt, and where the sovereign is subject to financial distress, constitutes a default event under Fitch's [ratings criteria]," the firm said in a statement.
Other ratings agencies have previously threatened to declare a default in the event of a debt restructuring.
Observers suggest they are under considerable political pressure not to do so, as if they do it could severely undermine confidence in both the eurozone economy and its banks.
The ECB and France had been particularly opposed to a restructuring and involving the private sector, but it was ultimately insisted on by Germany.
Mr Sarkozy played down the significance of the banks' participation in the aid package.
"If the rating agencies are using the word you just used (default), it is not part of my vocabulary. Greece will pay its debt," he told reporters.
European Commission President Jose Manuel Barroso indicated plans to rein in the power of the agencies.
"We... endorsed the plan of reducing over reliance on external credit ratings," he said, adding that policymakers would come forward in the autumn "with further proposals".