A tidal wave of optimism swept across Asian financial markets on Thursday, propelling stocks to multi-year highs as Japan's Nikkei index crept tantalizingly close to its all-time record.

The surge was ignited by a powerful rally on Wall Street, where positive corporate earnings and growing speculation about major international trade agreements fueled a risk-on frenzy among investors.

Regional Markets on Fire

The bullish sentiment was widespread. MSCI's broadest index of Asia-Pacific shares outside Japan jumped 0.4%, hitting a peak not seen in nearly four years. The buying spree was a direct follow-through from the U.S. session, which saw American stocks close at a record high.

In Tokyo, the excitement was palpable. The Nikkei 225 extended its recent gains, putting its record high from last year firmly within sight. The broader Topix index also climbed past previous peaks, a milestone shared by Singapore's benchmark index, underscoring the depth of investor confidence across the region.

Trade Hopes Fuel the Frenzy

The core driver behind the global rally is the growing belief that a new era of trade cooperation could be dawning. Traders are increasingly betting that the United States is on the verge of securing a trade agreement with the European Union. This speculation is gaining credibility after the Trump administration recently finalized pacts with key Asian partners, including Japan, the Philippines, and Indonesia.

This potent combination of solid corporate performance and the prospect of resolving long-standing trade disputes has created a powerful tailwind for global equities.

Europe Poised to Join the Party

The positive momentum looks set to continue as trading moves to Europe. Futures markets are flashing green, signaling a strong open. Pan-European futures were up a robust 1.17%, with Germany's DAX futures climbing 1.15% and London's FTSE futures rising 0.39%.

Meanwhile, in the currency markets, the euro held its ground, remaining steady as traders awaited the outcome of the European Central Bank's upcoming policy meeting. The stability suggests investors are cautiously optimistic, holding their breath for further direction from the central bank while riding the current wave of market enthusiasm.