On August 28th, the three major indexes of A-shares collectively closed higher, with a turnover of over 3 trillion yuan again, and the technology sector continued to lead the gains. Since the beginning of this year, major A-share indexes have performed outstandingly in the global market, and Hong Kong stocks and Chinese concept stocks have also performed well. Data shows that emerging markets, represented by China, are becoming a focus of global capital allocation. The iShares core MSCI Emerging Markets ETF (IEMG) has seen a net inflow of over $8.6 billion this year, significantly higher than related ETFs in developed markets. Institutional insiders believe that the restructuring of the global monetary system and the active management of fund managers betting on the weakening of the US dollar are driving funds towards emerging markets, a relatively low value area. The technology sector led the rise. According to Wind data, as of the close on August 28th, the Shanghai Composite Index, Shenzhen Component Index, and ChiNext Index have risen by 1.14%, 2.25%, and 3.82% respectively. The trend of large cap stocks is relatively dominant, with the Shanghai 50 Index and Shanghai 300 Index rising by 1.45% and 1.77% respectively. In terms of trading volume, the A-share market has exceeded 3 trillion yuan throughout the day, and has exceeded 3 trillion yuan for two consecutive trading days. Meng Jie, General Manager of Manulife Fund Research Department, believes that the recent high trading volume of A-shares for several consecutive days reflects active market trading. The technology sector continues to lead the gains. The Sci Tech Innovation 50 Index surged 7.23%, driving the communication equipment, semiconductor, and electronic components sectors up 7.31%, 6.15%, and 4.88% respectively. In terms of individual stocks, Tianfu Communication rose 20% to the limit up, Changxin Bochuang rose 18.84%, and DeKeli and Xinyisheng both rose over 15%. Huang Wentao, Chief Macro Analyst at CITIC Securities, stated that recently, the AI computing power sector has seen significant growth and has become the most eye-catching investment mainline in the market. Based on the recent limit up numbers of individual stocks in various sectors, sectors such as automotive parts, general equipment, consumer electronics, building decoration, other electronic components, and assembly have led the way. Emerging markets are favored. Since the beginning of this year, major A-share indices have performed outstandingly in global markets. According to Wind data, as of August 28th, the Sci Tech 50 Index has risen by 37.99% since the beginning of this year, the Shanghai Composite Index has risen by 14.67%, and the Shenzhen Component Index has risen by 20.71%, all outperforming major developed market indices such as the Dow Jones Industrial Average and Nasdaq Index during the same period. Overseas Chinese assets are also showing strong trends. The Hang Seng Index has risen by over 24% so far this year, while the Wande Zhonggai Technology Leading Index has risen by over 30%. This impressive performance has attracted the attention of global investors, and China and other emerging markets are becoming the new focus of international funds. Multiple mainstream institutions predict that the MSCI Emerging Markets Index is expected to rise by 15% in the next 12 months, outperforming developed markets by 10%. According to ETF.com data, as of August 28th this year, iShares' core MSCI Emerging Markets ETF (IEMG) had a net inflow of over $8.6 billion. Since April 2nd, this ETF has accelerated its earnings of approximately $5.8 billion, with a significantly higher inflow intensity compared to developed market related ETFs during the same period. According to data from the iShares official website, Chinese assets account for 27.98% of the index components tracked by IEMG, with Tencent Holdings, Alibaba SW, and other companies entering the top ten heavy holdings. Institutional insiders believe that since the beginning of this year, the restructuring of the global monetary system has driven global funds to seek higher yielding asset allocation. The significant increase in funds received by IEMG indicates that actively managed fund managers are betting on the continued weakness of the US dollar, prompting funds to flow into the relatively low value of emerging markets. Thomas Poullaouec, a fund manager at T. Rowe Price, a US asset management giant, has expressed a clear optimism about emerging markets: "We are taking an over allocation stance towards emerging market stocks in our multi asset portfolio because the valuations of emerging markets are more reasonable than those of developed markets and have better profit growth prospects." Foreign investors are optimistic about opportunities in China. Recently, Federal Reserve Chairman Powell has stated that the Fed is shifting towards a more relaxed stance as new risks have emerged. Zhao Yaoting, a global market strategist at Jingshun Asia Pacific, believes that the Federal Reserve is currently more concerned about the weakness of US employment data. In July, the number of non farm payrolls in the US only increased by 73000, while the expected number was 110000. Zhao Yaoting stated that although Powell did not explicitly state that the Federal Reserve would cut interest rates in September, he set a lower threshold for the rate cut. Zhao Yaoting predicts that the Federal Reserve will cut interest rates in September and at least once again before the end of this year, which will benefit risk assets. Multiple institutions have stated that the Federal Reserve's further shift towards loose policies may drive stronger performance in related assets. Meanwhile, a relatively mild inflation environment has also laid the conditions for the prosperity of emerging markets. Currently, the reconstruction of the global monetary order is still in its early stages, and there is still room for a mid-term reassessment of Chinese assets. ”Miao Yanliang, Chief Strategist of China International Capital Corporation (CICC), believes that under the new monetary order, the US dollar has entered a downward cycle, and US bonds, as a safe asset, are no longer safe. Global investors' demand for US bonds has decreased, which means that the suppressive effect of high interest rates on RMB assets may weaken. Miao Yanliang said that under the current situation, the risk premiums of both A-shares and Hong Kong stocks are at historical lows. If US bonds are no longer the pricing anchor, the pressure on Chinese stocks in terms of pricing will be greatly alleviated. Hong Kong stocks, as offshore RMB assets, are expected to directly benefit. Due to the high correlation between A-shares and Hong Kong stocks, the revaluation of Hong Kong stocks will also have a strong spillover effect on A-shares. Looking ahead to the future investment opportunities in the Chinese market, Zheng Wenli, a fund manager at Prudential, is particularly optimistic about two directions. One is the upgrade of consumption. The consumer market is in a transitional stage, with high-quality enterprises in traditional categories continuously improving their fundamentals, while new consumption patterns continue to emerge. The second is technological innovation. The emergence of DeepSeek has demonstrated China's strength in the field of artificial intelligence, and related technologies are accelerating their development, with the potential for further breakthroughs in the future. In the automotive industry, Chinese companies have not only established a leading position in electric vehicles, but also have the potential to catch up in the field of autonomous driving. (New Society)