The analysts also cited the potential impact of the U.S.-China trade talks that are taking place in Beijing this week.

“The trade talks are very important to the tech sentiment,” said Credit Suisse’s Abrams.

“A number of companies have held off capital investment projects (whether to stay in China or shift overseas) and also now cutting orders to deplete inventory for fear of a trade induced slowdown,” he said, adding that sentiment and demand from China have also been impacted by the uncertainty.

An agreement to lower tariffs or averting an escalation in trade tensions, will help lift Chinese demand and investments, as well as confidence for companies to add capacity or rebuild inventory, he said.

Export data for South Korean semiconductors declined by 23 percent in January. That, said Kiwoom Securities’ Yoo, was largely attributable to China.

As the U.S. puts pressure on China to open up its domestic market, South Korean chipmakers could benefit, Yoo said.

South Korea’s Samsung Electronics and SK Hynix are among the largest chipmakers in the world. So far this year, most semiconductor shares in Asia have seen strong gains.

In South Korea, shares of Samsung have gained almost 19 percent and chip maker SK Hynix risen more than 24 percent year-to-date on Tuesday.

Within the same time frame, Japan’s Tokyo Electron, which manufactures semiconductor equipment, has seen gains of about 25.3 percent while chip company Renesas Electronics has skyrocketed 43 percent. In Taiwan, major Apple supplier Taiwan Semiconductor Manufacturing Company has risen approximately 2 percent while Mediatek has gained more than 12 percent.

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