(Bloomberg) -- Asia investors got a fresh reason to be bullish Friday on news that top US and Chinese officials met as they tried to ease existing strains between the two countries.

US National Security Adviser Jake Sullivan sat down with Wang Yi, a China’s top diplomat, in Vienna for two days in what the White House called “substantive and constructive” meetings. The conversation set the stage for a possible call between President Joe Biden and Chinese President Xi Jinping, something that Chinese leaders have resisted for weeks.

US-listed Chinese stocks posted their biggest climb in three months Thursday, while Hong Kong-listed technology shares extended their gains into a third day Friday.

Some Chinese equities have been held back in recent months amid concerns about the impact of geopolitical tensions on the country’s companies. Potential investment limits in key parts of China’s economy by American businesses, and an alleged Chinese spy balloon in American airspace, have been among the concerns. The Hang Seng Tech Index is off more than 5% year-to-date, compared with a 7.5% gain for MSCI’s all-country index.

Here’s a selection of comments from analysts and strategists on what the meetings means for the markets:

Important Signal

The meeting gives hope to the market and sends a signal that the competition between China and the US will not be a vicious circle, according to Tommy Xie, head of greater China research at Oversea-Chinese Banking Corp. The gain in the Nasdaq Golden Dragon China Index on Thursday was evidence of market confidence. “There will still be boundaries, so there is no need to be too pessimistic,” he said. The market impact, however, may only be short-term as conflicts may still arise between the two countries.

Temporary Improvement

News of the meeting is likely to improve risk appetite on the stock market as it eases recent tensions between the two countries, according to Alvin Ngan, an analyst with Zhongtai Financial International Ltd. “Overseas-listed Chinese stocks and Chinese Internet sector, of which foreign investors have relatively high exposure, are likely to get a boost,” he said. However, the US may play the China card again approaching the presidential election and the countries’ relations may become bumpy again.

Limited Impact for Yuan

“It is hard to see any boost for the yuan from these meetings if the US continues to limit the technology advancement of China or act in ways that could raise tensions over Taiwan,” said Fiona Lim, senior foreign exchange strategist at Malayan Banking Bhd in Singapore.

TSMC Decent Proxy

“I think the TSMC ADR share price relative to the Nasdaq Global Semiconductor Index can serve as a decent proxy. Warren Buffett also recently announced that he had sold off all his holdings in TSMC because of geopolitical concerns,” said Alvin Tan, a strategist at RBC Capital Markets in Singapore, referring to the shares of Taiwan Semiconductor Manufacturing Co. News of the meeting itself is “very significant as relationship between the two countries had gone into deep freeze” after February’s balloon incident, he said.

--With assistance from Chester Yung, Mengchen Lu and Jing Zhao.

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