* C$ rises as high as C$1.0035 vs US$, or 99.65 U.S. cents * Follows oil, global markets higher * Bond prices retreat across the curve By Jennifer Kwan TORONTO, July 27 (Reuters) - The Canadian dollar soared to its highest level in 10 weeks on Friday on growing expectations the European Central Bank will take action to tackle the region's sovereign debt crisis and hopes of further stimulus by the U.S. Federal Reserve. Market sentiment got an additional boost after the leaders of France and Germany said they are "determined to do everything to protect the euro zone" and its single currency. That echoed ECB President Mario Draghi's pledge on Thursday to do whatever is necessary to protect the euro zone from collapse. "Lots of lip service from the ECB and Europe in general. The markets obviously liking the comments out of there and hoping for some action," said John Curran, senior vice president at CanadianForex. The Canadian dollar stood at C$1.0045 versus the greenback, or 99.55 U.S. cents, after hitting a high of C$1.0035. On Thursday, it finished the North American session at C$1.0096 against the U.S. dollar, or 99.05 U.S. cents. Curran said the market was also optimistic the U.S. Federal Reserve will move to stimulate the economy after data showed U.S. economic growth slowed in the second quarter. Top U.S. Federal Reserve officials recently spelled out what measures they might take to boost growth and hiring. Fed action could come as soon as next week, when the Fed's policy-setting committee meets on Tuesday and Wednesday. "People are looking for, hoping, praying for stimulus from the Fed. That's why the market is adding risk," said Curran. Blake Jespersen, managing director of foreign exchange sales at BMO Capital Markets, said market moves will be largely contained until there is more clarity around Europe. "It's still fairly rangebound, lighter volumes, and I think the market in general is just waiting for more clarity from the ECB in terms of what they have in mind to sustain the euro at whatever cost," added Jespersen. Canadian bond prices moved lower across the curve with the two-year bond off 20 Canadian cents to yield 1.115 percent, and the benchmark 10-year bond down 98 Canadian cents lower to yield 1.750 percent.