European semiconductor shares traded sharply higher Wednesday, lifting U.S. rivals such as Advanced Micro Devices (AMD - Get Report) and Micron Technology (MU - Get Report) in pre-market trading, following a report that suggests a key Asia supplier is seeing more orders for smartphone chips heading into the second quarter.

The Digitimes website said Taiwan Semiconductor Manufacturing Company (TSM - Get Report) , one of the world's biggest chipmakers, will ramp up its 7 nanometer production rates thanks to renewed strength in orders for Android devices. The accelerated pace could see TSMC running at full capacity by the third quarter, the Digitimes reported, suggesting industry forecasts of a second half turnaround in global chip demand could prove accurate. Both Apple Inc. (AAPL - Get Report) and China's Huawei, the world's second-largest smartphone marker, use 7nm chipsets in their latest devices. 

AMD shares were marked 5.9% higher Wednesday at $28.31 each for the key TSMC client. Micron, meanwhile, was seen 4.15% higher at $44.20 each. a move that will help support gains for the Philadelphia Semiconductor index, the sector benchmark, which rebounded nearly 24% since the beginning of the year. Intel (INTC - Get Report) shares were marked 1.5% higher at $55.18 each. 

In Europe, Swiss-listed AMS AG (AMSSY) , which designs facial recognition sensors thought to be used in Apple iPhones, traded at the top of the Stoxx 600 before paring gains to 4.05% on the session, while Infineon Technologies AG (IFNNY)  gained 4.28% to top the DAX performance index in Germany.

STMicroelectronics (STM - Get Report) shares were also on the move, rising 5.72% to the top of the CAC-40 in Paris.

Infineon's move is crucial for sector sentiment after Europe's biggest chipmaker warned on profits last week and rippled through U.S. chipmmakers, in part because the German group appears to have dropped hopes of a second-half rebound in chip demand - a condition many if not most of the major suppliers have pinned their 2019 outlooks upon.

"The slowdown in demand is a result of ongoing customer inventory adjustments, as well as software optimizations at some cloud customers," Micron Technologies (MU - Get Report) CEO Sanjay Mehrotra told investors on a conference call last week, echoing similar assessments from sector peers. "We expect growth to resume in the second half of calendar 2019 as we see improvement in our customers' inventory position."