Morgan Stanley Fund stated in a document that, looking ahead, in the layout of major asset classes, overseas investors may continue to pay attention to the big election year (the second presidential debate on September 11), whether the US economy will have a "soft landing," the Fed's interest rate cuts, and changes in liquidity, focusing on long opportunities in the US dollar and oil assets. In terms of domestic focus, in the short term, there is a high probability of style switching continuing, with small caps outperforming large caps, growth outperforming value, and a focus on broad-based opportunities such as the CSI 1000 index; in the medium to long term, attention should continue to be on the three main drivers of developing new quality productivity, with a focus on semiconductor, low-altitude economy, and artificial intelligence. In August, the overseas main theme shifted from "recession trading" to interest rate cuts and large election trading, with overseas equity assets showing a V-shaped rebound trend and volatility significantly increasing. Market expectations for a Fed rate cut have strengthened, US bond yields have declined, the US dollar is weakening, and interest rate-sensitive assets are performing well. Morgan Stanley Fund believes that the current US economy still has some resilience under high fiscal deficits, and after the start of the rate cut cycle, it is more important to pay attention to the economy's "elasticity," which relates to when the economy will land and whether there is a risk of secondary inflation. Looking at the data, the preliminary value of the US August Markit Manufacturing PMI was 48, lower than the expected 49.5, the lowest since the beginning of this year, indicating that manufacturing is cooling at an accelerated pace. However, the preliminary value of the services PMI was 55.2, higher than the expected 54, consistently in the expansion zone for 19 months. On monetary policy, Powell's speech at the Jackson Hole Global Central Bank Summit stated that the time for policy adjustment has come, the future direction is clear, and the timing and pace of rate cuts will depend on data, prospects, and balancing risks. Powell also emphasized growing confidence that the inflation rate will sustainably return to the target level of 2%. Additionally, after lower-than-expected non-farm payroll data was released last Friday, it signifies that the Fed rate cut in September is almost certain, the rate cut cycle may officially begin, but the magnitude of the rate cut still has uncertainty. The market's short-term intensification of rate cut expectations could lead to excessive adjustments in US bonds and the US dollar. In terms of Japan, the hawkish rate hike by the Bank of Japan on July 31 was one of the catalysts for recent significant volatility in global markets. Japan's economy has continued its recovery trend recently, with private consumption and real wage growth stabilizing, and the uncertainty regarding future monetary policy remains, with the possibility of the Bank of Japan raising rates again this year not ruled out. Morgan Stanley Fund pointed out that domestically, in terms of monetary policy, the demand for stable growth has increased, the constraints on the exchange rate have eased, and the downward trend in long-term bond rates has temporarily halted, with further room expected to open up for monetary policy. Regarding fiscal policy, with pressure on fiscal revenue limiting the extent of fiscal expansion and a lower annual economic growth target, government debt issuance accelerated in August, and it is expected that fiscal policy will further strengthen in the second half of the year. In the real estate sector, the market's response to real estate policies has slightly dulled, with the Ministry of Housing and Urban-Rural Development proposing to establish housing inspections, housing pension, and housing insurance systems to build a long-term, effective mechanism for housing safety management throughout the entire life cycle. In the medium to long term, the focus still needs to be on the three main drivers of developing new quality productivity: nurturing and expanding emerging industries, forward-looking layout for future industries, and leveraging advanced technology to empower the transformation and upgrading of traditional industries. It is recommended to continue to focus on areas such as semiconductors, the low-altitude economy, and artificial intelligence.