China's commerce ministry said it would hold vice ministerial talks with the United States on Jan. 7-8 as they look to end the trade war that has been hurting both economies and markets across the globe.

The MSCI index of emerging market shares rose 0.7 percent to their highest in a week, with mainland China and Hong Kong shares closing more than 2 percent higher each.

While noting the optimism from the upcoming talks, analysts however, remain cautious of a definitive outcome from the meeting.

"While this will be the first face-to-face talks since the 90-day trade truce, suggesting that the trade negotiation is still on the track, a vice-minister level talk also indicates that a breakthrough is unlikely to be made for the time being," Commerzbank analysts said in a note.

Besides trade talk hopes, China stocks were boosted by the government's move to cut banks' reserve requirement ratios as it sought to support the economy, and as data showed the country's December services sector extended its solid expansion.

Most other developing market bourses across Asia were also in the black. Turkey stocks rose over 1 percent in on course for their best session in two weeks, while South Africa shares climbed 0.7 percent.

The broader emerging market index, however, is on track for a loss over the week - the first time it started the year in the red since 2016, owing to hefty losses earlier in the week.

The tepid dollar and fast fading prospects of higher interest rates from the US Federal Reserve lent support to developing market currencies, helping the index hit a one month high with most Asian currencies firming.

But, the gains on emerging markets currencies may be limited which ever way the Fed were to move, Morten Lund, an analyst with Nordea Markets suggested.

"Either the Fed can continue hiking rates ... that would be bad for EM. Or, if they were to actually stop, which you can say the market has priced in now, it would probably mean we would see a slowdown in the real economy, that would also not be good for EMFX."

On the day, the Turkish lira climbed nearly 1 percent, recovering from its steep dive last session when lower-than-expected inflation data had investors betting on chances that the central bank could make a premature rate cut.

Commodity-rich South Africa's rand firmed more than 1 percent, with slower rate of decline in December's private sector activity which fanned economic recovery hopes, adding to its cheer.

The Russian rouble touched a near two-week high as it found support from higher oil prices.

Among emerging European economies, Polish stocks led gains in the region with its 0.8 percent climb, while the zloty weakened as December inflation dipped further below the central bank's target range ahead of next week's interest rate meeting.