Core Viewpoints - The overall performance of global asset classes in February 2026 ranked as follows: commodities (2.13%) > global stocks (1.59%) > RMB (1.38%) > global bonds (1.12%) > USD (0.64%) > 0% [2] Group 1: Global Asset Overview - Concerns over geopolitical risks between the US and Iran have heightened risk aversion in the US stock market, with the S&P 500 index facing significant resistance at the 7000-point level. The market is exhibiting extreme defensive characteristics, with a notable shift of funds from high-elasticity cyclical sectors to defensive sectors since January 2026 [4] - The relative valuation of US stocks has fallen to a decade-low, with the S&P 500 equal-weight index's price-to-earnings ratio compared to global (excluding the US) markets dropping to 1.11, indicating a significant reduction in the valuation premium of US stocks [19] - A significant divergence in pricing between US stocks and bonds for technology and industrial sectors has emerged, with the credit spread between industrial and technology sectors reaching a historical low of -22 basis points, indicating a reversal in credit confidence towards the technology sector [22] Group 2: Fund Manager Positioning - Global fund managers are experiencing a "non-US" and "cyclical" adjustment in their positions, with the net overweight ratio for emerging markets rising to 49%, the highest level since February 2021. This reflects a significant return of funds to emerging markets at a pace not seen in five years [25] Group 3: Currency and Trade Dynamics - Following the US Supreme Court's ruling against Trump's "emergency" tariffs, the dollar weakened. The ruling led to a decrease in supply chain costs and improved corporate earnings expectations, with the dollar index and VIX index falling by 0.10% and 5.64%, respectively, on February 20 [30] - The Bank of China has reduced the foreign exchange risk reserve ratio for forward foreign exchange transactions from 20% to zero, aiming to curb the rapid appreciation of the RMB and guide the USD/RMB exchange rate back to 6.86 [51] Group 4: International Investment Trends - Overseas investors are actively engaging in a "flattening" strategy for Japanese government bonds, driven by expectations of reduced long-term bond supply starting in April. This strategy allows USD investors to lock in approximately 6% total returns, composed of a 4% coupon and 2% from currency hedging [35] - The yen's status as a global safe-haven asset is closely related to changes in Japan's international balance of payments, with a significant shift occurring in 2005 when overseas investment income began to surpass trade surpluses [38] Group 5: Market Divergence - There is a notable divergence between the Hang Seng Technology Index and the Korean KOSPI Index, with the former experiencing a 10.15% drop in February, entering a technical bear market, while the KOSPI surged past 6000 points, driven by enthusiasm for semiconductors and AI hardware, reflecting a shift in capital flows [43] - The UK stock market has shown a high degree of correlation with global resource stocks over the past decade, particularly since late 2024, as the UK index has a high weight in energy and materials sectors, making it a mirror of global resource pricing [48]

Market Trends - Global asset performance in February 2026 ranked commodities (2.13%) highest, followed by global stocks (1.59%), and the Chinese yuan (1.38%) [2] - The S&P 500 index faces significant resistance at the 7000-point level, with heightened defensive behavior in the market due to geopolitical risks [3] - The relative valuation of U.S. stocks has dropped to a ten-year low, with the S&P 500 equal-weighted index's P/E ratio at 1.11 compared to global markets excluding the U.S. [3] Investment Strategies - Fund managers are shifting towards emerging markets, with a net overweight ratio rising to 49%, the highest since February 2021 [4] - Defensive sectors like consumer staples have outperformed cyclical sectors since January 2026, indicating a cautious market sentiment [3] Currency and Bond Market - The U.S. dollar weakened following the Supreme Court's ruling against Trump's tariffs, with the dollar index dropping by 0.10% and the VIX index by 5.64% on February 20 [5] - Japanese long-term bonds are being purchased by overseas investors, leading to a flattening of the yield curve, with expected total returns around 6% for dollar investors [6] Global Economic Indicators - The yen's status as a global safe-haven asset is linked to changes in Japan's international balance of payments, with a significant shift occurring since 2005 [7] - The Hang Seng Tech Index fell by 10.15% in February, while the KOSPI index surged by 46% year-to-date, indicating a divergence in market sentiment between the two regions [8] Risk Factors - The AI technology bubble is identified as a major tail risk, with 25% of fund managers citing it as a concern in February 2026 [9] - The People's Bank of China has reduced the foreign exchange risk reserve requirement to zero, aiming to stabilize the yuan's appreciation against the dollar [10]