(Bloomberg) -- Tech is back, and it couldn’t have come at a better time for Asia.

With optimism for a quick U.S.-China trade deal starting to fade as the two sides haggle over nagging details, stock markets in the region need all the help they can get to keep the good times rolling. And it’s tech again that came to the rescue.

Technology companies in the MSCI Asia Pacific Index have led the charge this week, taking their rebound from a January low to 20 percent. The sector is also back to being the biggest gainer for the year.

For its part, the Asia Pacific index is near its highest level since early October, on pace for a second weekly advance after a lull earlier this month. The benchmark pared an early gain on Friday, with most major markets flat as Japan reopened following a holiday while Chinese stocks dropped.

While tech is Friday’s highlight, investors are also still parsing the implications of the Federal Reserve signaling Wednesday that it will hold off on interest-rate increases this year, due to concerns about the slowing U.S. economy. On the one hand, a weaker greenback is a positive for emerging-market economies in the region, but on the other, a stalling U.S. engine is bad news for global growth. The Fed’s more dovish stance does open the door for Asia’s central banks to potentially cut rates.

Leading the way for tech, giant Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co., which collectively account for about a third of the MSCI Asia Pacific Information Technology Index, have advanced more than 3 percent each this week to join a wider rally in global chip stocks.

The sector jumped overnight in the U.S., driving a 3.5 percent advance in the Philadelphia Semiconductor Index as it came close to the peak it hit a year ago. Micron Technology Inc., the largest U.S. maker of computer-memory chips, reported quarterly results ahead of analysts’ estimates while also announcing plans to cut production in response to a slump in demand.

“While the production cut is not significant in absolute terms, we believe Micron’s action is positive for the memory industry as we expect it to lead to a market reassessment of the current concerns,” Peter Lee, an analyst with Citigroup Global Markets Inc., wrote in a note to clients.

The picture is a bit different for two of the most prominent Hong Kong-listed tech stocks, with both Tencent Holdings Ltd. and Xiaomi Corp. reporting a mixed bag of earnings this week.

Tencent, the most-valuable stock in the Hang Seng Index and biggest component of the MSCI Asia Pacific Index, fluctuated after posting a slump in fourth-quarter earnings on increased spending. Analysts kept an optimistic view, saying smartphone-games revenue is likely to accelerate and that the company can successfully expand beyond gaming and consumer Internet.

Smartphone maker Xiaomi actually bested analysts’ forecasts, after raising retail prices, revamping its budget label and expanding overseas. But it hasn’t been enough to convince investors the company is on the right track as it’s still struggling to compete in China’s plateauing smartphone market. The stock is headed for a fourth weekly loss, extending its decline this year to 13 percent.

Stock-Market Summary

  • MSCI Asia Pacific Index little changed
  • Japan’s Topix index little changed; Nikkei 225 down 0.1%
  • Hong Kong’s Hang Seng Index down 0.5%; Hang Seng China Enterprises down 0.9%; Shanghai Composite down 0.8%; CSI 300 down 1%
  • Taiwan’s Taiex index little changed
  • South Korea’s Kospi index little changed; Kospi 200 up 0.1%
  • Australia’s S&P/ASX 200 up 0.4%; New Zealand’s S&P/NZX 50 up 0.9%
  • India’s S&P BSE Sensex Index up 0.4%; NSE Nifty 50 up 0.4%
  • Singapore’s Straits Times Index little changed; Malaysia’s KLCI down 0.3%; Philippine Stock Exchange Index up 0.8%; Jakarta Composite little changed; Thailand’s SET up 0.3%; Vietnam’s VN Index up 0.3%
  • S&P 500 e-mini futures down 0.2% after index closed up 1.1% in last session

To contact the reporter on this story: Eric Lam in Hong Kong at elam87@bloomberg.net

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Cecile Vannucci, Divya Balji

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