The Nikkei 225 rose 1.9% and was near record-high levels last seen in July 2024, while the TOPIX surged 1.9% to a record high of 2,982.14 points

Most Asian stocks rose on Thursday, with Japanese markets near record highs on sustained optimism over a U.S. trade deal, while technology shares were buoyed by strong earnings from Google owner Alphabet Inc.

Strong earnings from Nvidia supplier SK Hynix Inc also boosted Asian tech, especially as the memory chip giant flagged expectations for robust artificial intelligence-fuelled demand.

Regional markets took positive cues from a record-high overnight close on Wall Street, as investors cheered a Japan-U.S. trade deal and held out hope for more such agreements before an August 1 deadline.

In addition to Alphabet’s earnings, tech shares were also encouraged by President Donald Trump flagging more policy support for the AI industry. This helped markets look past steep losses in Tesla, after it clocked an underwhelming second quarter.

S&P 500 Futures rose 0.2% in Asian trade, while Nasdaq 100 Futures rose 0.4%.

Japanese shares continued to outpace their peers after Tokyo and Washington agreed to a trade deal on Wednesday. The Nikkei 225 rose 1.9% and was near record-high levels last seen in July 2024, while the TOPIX surged 1.9% to a record high of 2,982.14 points.

Japan will face a 15% tariff on exports to the U.S., a smaller duty than the 25% initially threatened by Trump. Japanese automobiles will also face a 15% duty, which is lower than a 25% U.S. duty on foreign automobiles.

The deal cleared up some uncertainty over the impact of U.S. tariffs on the Japanese economy, although the 15% duty is still expected to provide some headwinds.

Optimism over the trade deal also saw Japanese markets largely rise past purchasing managers index data that showed the country’s manufacturing sector unexpectedly shrank in July. But services activity picked up.