Asian shares should benefit from improving risk appetite on Wednesday after strong trade data boosted expectations for U.S. growth while a lessening of sovereign strains in Europe lifted stocks there to the highest since 2008.
The dollar also got a leg up on the yen after the US trade deficit shrank to its lowest in four years, thanks mainly to a renaissance in energy production, prompting analysts to revise up forecasts for economic growth.
Barclays, for one, doubled its estimate for last quarter and now predicts growth of 3 percent annualised.
Underlining the brighter mood were reports the International Monetary Fund will lift its forecast for global growth in about three weeks, breaking a depressingly-long run of downgrades.
All of which helped MSCI's all-country world stock index hit its highest since mid-2008. The Dow added 0.64 percent, while the S&P 500 rose 0.61 percent.
The optimism flowed through into Asia on Wednesday with Nikkei futures pointing to a firmer start and Australian shares gaining 0.6 per cent.
MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.14 percent.
European equity indexes rose to 5-1/2 year highs, led by a near 3 percent jump in Spain. The FTSEurofirst 300 index of top European shares gained 0.8 percent.
Sovereign risks across the euro zone's periphery have been receding as longer-term borrowing costs fall to multi-year troughs.
Yields on Irish 10-year debt dropped to their lowest in eight years after the country's first debt sale since exiting its EU/IMF bailout drew hot demand.
Yet data out Tuesday also showed core inflation in the EU slowed to a record low of just 0.7 percent in December, fanning fears of deflation ahead of the European Central Bank's policy meeting on Thursday.
It was worries about inflation falling too far that led the central bank to cut interest rates in November.
"This month's data will help reinforce expectations that the ECB are ready and willing to take whatever steps they deem necessary to prevent the economy from slipping into deflation," said economists at ANZ in a note to clients.
"While we think that the ECB will remain on hold this week, we are expecting a very dovish statement from ECB President Draghi."
The uncertainty kept the euro pinned at $1.3614 and not far from its recent one-month low at $1.3570.
The dollar got a boost from the U.S. trade numbers and climbed as far as 80.946 against a basket of currencies, reaching highs last seen in early