NEW YORK - The New York and Tokyo Stock Exchanges announced an alliance yesterday that extends the NYSE's global reach and could lead to an eventual combination of the world's two largest financial markets.

The broad, nonexclusive agreement announced by NYSE chief executive officer John Thain and TSE president Taizo Nishimuro allows the two stock markets to cooperate on joint developments such as financial products, mutual listings and technology.

The deal comes amid a backdrop of mass consolidation among domestic and global exchanges, highlighted by the NYSE's transformation into the first transatlantic market with its recent acquisition of Paris-based exchange operator Euronext N.V.

NYSE Group Inc., which is competing fiercely with the Nasdaq Stock Market Inc., just weeks ago announced it had led a team of investors to buy a 20 percent stake in India's largest financial market, the Mumbai-based National Stock Exchange.

The agreement with Tokyo Stock Exchange Inc. gives the New York exchange an entree into the Pacific. It is also a first step toward a possible merger or acquisition between the two exchanges when the TSE becomes a public company in 2009.

Thain made it clear during a news conference yesterday that the two companies planned some form of combination in the future, saying: "We're also setting the stage for a potential capital linkage."

The two exchanges did not offer any details of what form that would take. But, Nishimuro said at the news conference, the two markets needed to secure a broader cooperation or risk being left out as rivals pursued their own deals.

"This is not a merger, it is an intent to explore," he said. "The environment has changed, the world is getting smaller, and the relations between New York and Tokyo should be better defined. We will be the world's first truly global marketplace."

For consumers, an alliance and possible combination between New York and Tokyo could bring about a number of investing opportunities. Thain said he hoped both would cooperate on creating new exchange-traded funds, which trade as a single security but could follow the performance of a mix of U.S. and Japanese companies. The two exchanges also hope to have more Japanese companies listed on the NYSE.

Thain said that the accord would "make it easier to trade between the two exchanges" and that one day U.S. investors might be able to make round-the-clock transactions. Companies listed on the Tokyo exchange, which include Toyota Motor Corp., have a combined market value of $4.6 trillion; the NYSE has $15.4 trillion, with listings such as Citigroup Inc. and Exxon Mobil Corp.

Under terms of the agreement, NYSE Group and the TSE will establish working groups to discuss such things as infrastructure, technology and trading issues, as well as market-data products and regulation and governance of listed companies.