Jessica, daughter of the Jewish moneylender Shylock, is the torchbearer being referred to in this scene. This scene specifically relates to her preparations to elope with her Christian lover, Lorenzo, which occurs in Act 2, Scene 6.
In Act II, Scene 5, Shylock is preparing to have dinner with Bassanio, Antonio, and their friends. He loathes socializing with Christians, but decides to honor their invitation as a matter of courtesy since he signed an agreement with Antonio to extend Bassanio a loan of three thousand ducats. His agreement to attend is, therefore, more for business than anything else.
During this particular evening, the Christians are hosting a street carnival where participants wear masks. Shylock instructs Jessica not to take any interest in such — what he believes to be — immoral practices and tells her to lock the doors after his departure and not to look out the window to watch the celebrations in the streets.
Unbeknownst to him, though, Jessica has waited for exactly such an occasion to elope with Lorenzo. She already informed Lorenzo of her plan, and, once Launcelot (Shylock's servant) tells Lorenzo that Shylock will attend their banquet, he realizes it would be the ideal opportunity for Jessica to run away with him. He tells his friends,
I must needs tell thee all. She hath directed
How I shall take her from her father's house,
What gold and jewels she is furnish'd with,
What page's suit she hath in readiness.
If e'er the Jew her father come to heaven,
It will be for his gentle daughter's sake:
And never dare misfortune cross her foot,
Unless she do it under this excuse,
That she is issue to a faithless Jew.
Come, go with me; peruse this as thou goest:
Fair Jessica shall be my torch-bearer.
It is clear Jessica has already planned her escape, will be disguised as a boy, and will carry Lorenzo's torch to make the disguise more convincing. This fact is later confirmed when the men arrive at Shylock's apartment. Lorenzo calls out to Jessica and she appears at the window, dressed as a boy. She is quite embarrassed and says,
Cupid himself would blush
To see me thus transformed to a boy.
Lorenzo tells Jessica she must be his torchbearer. She asks whether she must carry a candle to her shame because her identity must be obscured. Lorenzo assures her she is not recognizable because she is disguised as a boy. She comes down and leaves with Lorenzo and Salarino, as well as a substantial amount of her father's money and jewels, which she stole.