The foundation of the petrodollar is shaking! Zhang Yidong's latest analysis: Gold is approaching a strategic buying point. Don't just focus on Hengke; these three main lines are more critical.

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On March 25, amid recent international turbulence and market fluctuations at home and abroad, Sina Finance held an in-depth discussion with Zhang Yidong, Executive Committee Member of Haitong International, Chief Economist, and Head of Research, on “Reconstruction of the International Order: Opportunities in Crisis, Long-term Bull Market for China’s Hard Assets.”>> Live Video

He pointed out that the current global landscape is no longer the high-growth era of globalization over the past 30 years. Frequent geopolitical conflicts and the reordering of international systems are driving a fundamental shift in global capital market pricing logic—from “efficiency pricing” to “safety pricing.”

Zhang Yidong emphasized, don’t just focus on one stock like Hengke. Whether it’s A-shares or Hong Kong stocks, China’s current position is now only loosely correlated with overseas markets and Europe/America, with minimal downward risk—at most, a misjudged sell-off. But the resilience of upward movement can be somewhat understated because current indices do not quickly or accurately reflect China’s economic transformation and new technological development patterns. The truly worth关注 are the three main lines under the SMART framework—safe assets, manufacturing going global, and R&D-driven high-tech.

Zhang Yidong: Reconstruction of the International Order—Global Asset Pricing Shifts from “Efficiency” to “Safety”

He analyzed that over the past 30 years, the U.S. has set rules through international organizations like WTO, IMF, and the World Bank to maintain its hegemonic benefits. But now, the U.S. has abandoned its “lighthouse” role, no longer acting as the “world policeman,” instead willing to play the role of “robber.” Long-standing contradictions are shifting from quantitative to qualitative changes. “Frequent geopolitical conflicts and the reconstruction of the international order have profound impacts on our asset allocation and pricing.” Zhang emphasized, “In short, this impact is a shift from efficiency pricing to safety pricing.”

He pointed out that the reconstruction of the international order will influence capital markets through three main lines:

First, geopolitical mainline. Take the Middle East issue as an example: the Strait of Hormuz, a vital energy transportation artery, has been cut off, triggering a global energy supply crisis. The unpredictability of geopolitical conflicts is elevating risk premiums in global assets. Since 2008, risk premiums in U.S. markets have fallen into negative territory. With ongoing geopolitical risks, future asset pricing must incorporate risk premiums as a key factor.

Second, the reconstruction of international financial order. The weaponization of the dollar—excluding SWIFT for those deemed unfriendly—has become a tool for asserting hegemony. In this context, the internationalization of the RMB and the reassessment of gold’s value are responses to this financial order reshaping. Gold’s role as the “ultimate credit anchor” is being reevaluated.

Third, the reconstruction of international trade and economic order. Decoupling, supply chain disruptions, and rising protectionism have made supply chain resilience and security more important than traditional efficiency standards. Whether resource security or energy supply security, these factors are now top considerations in asset pricing.

Zhang Yidong on Middle East Situation: Listen to Words, Watch Actions—Three Key Points for Ceasefire

He noted that recent U.S. signals aim to de-escalate tensions, with Trump tweeting and backtracking, possibly trying “pressure for peace,” but a real ceasefire has not yet arrived. Investors should not only listen to words but also observe actions, even paying attention to what is not said—sometimes more important than what is.

Zhang believes that three dimensions can help judge whether the Middle East situation is truly cooling:

First, domestic U.S. pressure. About 40% of Americans still support the war, so anti-war sentiment is not yet overwhelming. Regarding military spending, even if the new $200 billion military budget request is not approved, existing military funds can sustain operations for a while longer—“not yet at the point of running out of ammunition.”

Second, the reaction of U.S. capital markets. Over the past two weeks, U.S. stocks declined nearly as much as during the April 2025 tariff war, but worse, both stocks and bonds suffered—while the dollar remained relatively strong. This adjustment seems insufficient to make Trump feel “pain,” and he has not yet taken concrete steps to retreat.

Third, whether Iran can still fight. It’s a two-way street: if Iran backs down, the situation could quickly ease. But Zhang believes the Iranian people are far from surrendering or capitulating.

“Over the past three weeks, Iran’s tactics have become more strategic. Its long- and medium-range missile stocks, previously thought nonexistent, are now confirmed to be well-stocked and hidden. The missile inventory exceeded expectations. From a military perspective, Iran is not in a hurry to sign a surrender agreement.” Under pressure from the U.S. and Israel, Iran has instead united internally. The society and economy, once fragile and divided, are now rallying around “survival.” “It’s very difficult for the U.S. to easily subdue the Iranian people; expecting them to disintegrate quickly is unrealistic.”

When Will True Ceasefire Arrive? Zhang Yidong: Watch Three Variables—An Unprecedented Uncertainty

He highlighted an unprecedented variable: Netanyahu’s influence and restraint over the U.S. and Trump. “Historically, U.S. leaders act independently, not based on allies’ opinions. Even during WWI and WWII, Britain begged the U.S. to join, and the U.S. continued to sell arms and supplies to both sides until Pearl Harbor. But this time, U.S. leaders say they will consult with Israel.”

He believes that the core variable for de-escalation is the political and economic situation within the U.S. If large-scale domestic opposition to the war emerges, Congress refuses funding, and the conflict cannot continue—especially with midterm elections looming—these factors could force Trump to compromise.

He states that the real sign of ceasefire will not be Trump’s verbal statement but the withdrawal of U.S. aircraft carriers or the emergence of a ceasefire agreement. “What cannot be obtained on the battlefield should not be expected from negotiations. If the U.S. cannot get what it wants on the battlefield, negotiations won’t deliver either. Ultimately, some compromise will happen.”

He estimates the earliest possible ceasefire could be in early April. “When the real ‘T’ arrives, investors can adopt a risk-on stance and be more optimistic about investments.” But caution is needed for low-probability events—such as U.S. ground troops deepening involvement. Zhang believes this only happens if “Israel’s variables” change significantly. “Israel’s influence on U.S. politics and the economy, especially its impact on the political arena, is now very profound,” he said.

“The phase of most brutal valuation destruction is over”—Zhang Yidong’s Latest: TACO Trading May Restart

“The most intense phase of global capital market shocks has passed; the period of brutal valuation destruction is over,” Zhang Yidong judged. He believes that the peak impact of this war on global investors’ psychology, valuation, and risk premiums has already subsided. The earliest restart of TACO trading could be in early April.

He also warned not to ignore the impact of low-probability events. If the U.S. deploys large-scale ground forces, Iran might respond with a “fish or cut bait” approach, turning the Hormuz Strait crisis from a monthly concern into a semi-annual or annual ongoing shock.

Should You Buy Oil Assets or Gold Now? Zhang Yidong: Without Question, Gold!

When asked whether current prices favor buying oil-related assets or gold, Zhang Yidong clearly stated, “Without question, it’s gold.” From tactical and strategic perspectives, gold now has allocation value, mainly because the foundation of the petrodollar system is undergoing a dramatic shake-up.

He explained that understanding this gold bull market requires more than just watching the dollar’s strength; it must be viewed from the perspective of the reconstruction of the international financial order. In 1974, the U.S. and Saudi Arabia reached an “unshakable agreement”: the U.S. provided military security to Saudi Arabia, which in turn agreed to price and settle all oil trade in dollars, using surplus oil revenues to buy U.S. Treasuries, forming the petrodollar cycle. For decades, the petrodollar has been a core pillar of dollar hegemony.

“But in this round of Middle East conflicts, the U.S. cannot protect Saudi Arabia or the UAE, nor other oil-producing countries in the region,” Zhang said frankly. “When the U.S. can no longer provide basic security guarantees, the foundation of the petrodollar begins to shake.”

This shake is not just theoretical; it’s reflected in real trading data. Zhang Yidong revealed that three months ago, the proportion of RMB settlement in Saudi oil exports to China was less than 20%. By the end of March this year, it had surged to 40%. “In just three months, it doubled, showing that oil-producing countries are ‘voting with their feet’ in practice.”

He sees this as a microcosm of the shifting balance in the petrodollar system. Bilateral currency swap agreements China signed with Saudi Arabia, the UAE, and other Middle Eastern nations are accelerating under the war context, promoting diversification in international oil trade settlement currencies.

Looking back historically, during the Gulf War in 1990, the U.S. quickly won and further solidified the petrodollar’s dominance. But this time, the Middle East conflict is unfolding differently: the U.S. struggles to quickly control the situation, and its “protection commitments” are being challenged.

“Over the past two weeks, oil prices and the dollar have risen, while gold has fallen. This is partly due to profit-taking at the start of the year and the inertia of the petrodollar system,” Zhang analyzed. But in the medium to long term, gold’s essence is as a hedge against global sovereign credit risk and as the “ultimate anchor” in the reconstruction of the financial order.

He further supported this with data: when gold prices hit $5,600 per ounce, the total global gold market value was about $40 trillion—roughly matching the U.S. federal debt level at the end of 2024. “The logic of the gold bull market is to hedge sovereign credit risks of major economies—including the U.S., EU, Japan, UK, and G20 countries. With global sovereign debt exceeding $100 trillion, from this perspective, gold is well-positioned both strategically and tactically.”

Zhang Yidong: Gold and Hard Tech—Not Opposites but Resonant Upward Trends

He pointed out that recent market adjustments show gold and tech stocks declining together, reflecting liquidity shocks. Once liquidity stabilizes, both will strengthen, but their upward logic differs.

Gold’s rise is based on the fact that, after TACO’s implementation, markets will better recognize that the U.S. is no longer mysterious or invincible. This realization will accelerate the weakening of the petrodollar foundation, further highlighting gold’s strategic value as a sovereign credit hedge.

The growth of tech stocks, on the other hand, depends on the U.S. possibly easing Middle East tensions by adopting “money-printing” policies to ease domestic economic pressures. Zhang cited a recent Reuters poll showing Trump’s approval rating has fallen to its lowest since taking office, even below Biden’s levels. In this context, expectations of rate cuts will push down risk-free yields, supporting a short-term rebound in growth stocks.

The real “opposite sides” are oil and energy chains, not gold and tech. Zhang emphasized that if a risk-on rally triggered by TACO occurs, the true “tug-of-war” will be in oil and energy sectors. Recently, overseas investors have adopted a risk-averse pattern of “cash (USD) in one hand, energy chain in the other,” with gold and growth tech suffering. Once ceasefire is achieved, this pattern will reverse, and oil will face marginal weakening.

China’s Energy Self-sufficiency at 85% Outperforms Japan and Europe! Zhang Yidong: Three Certainties in Geopolitical Conflict Opportunities

He explained that resources, energy, and gold have always been fundamental strengths. But why do their strategic attributes rise systematically under current conditions? Using energy as an example:

“Energy has been hovering at low levels for the past four years, leading to very low capital expenditure by oil service companies—almost zero growth, very different from history.” Zhang said. “But now, this war has made everyone realize the importance of strategic oil reserves.”

Although the U.S. has released strategic reserves through allies to suppress oil prices, ongoing conflicts will pressure Japan, Korea, and Europe’s energy supplies. These countries will inevitably need to increase their strategic reserves, possibly to higher levels. Meanwhile, the Strait of Hormuz, carrying 20% of global oil trade, has effectively been cut off, likely pushing global energy prices higher this year and next.

Zhang highly praised China’s energy strategy: “As early as 2018, we explicitly stated the need to ensure national energy security. Since then, whether in coal, coal chemicals, or oil and gas exploration, we have adhered to the principle of ‘holding the energy rice bowl in our own hands.’” He pointed out that China’s energy self-sufficiency rate is 85%, far higher than Japan’s 16% or Korea’s less than 20%. In a geopolitical environment with frequent conflicts and prolonged chaos in the Middle East, China’s manufacturing advantages will be very evident—whether in energy prices, electricity, or energy security capabilities, they are overwhelmingly superior.

He believes that regardless of how long the war lasts, three points are certain: First, Europe, Japan, and Korea will increase investments in alternative energy—nuclear, hydrogen, wind, and other clean energies. Second, the construction of new power systems and the export and overseas deployment of China’s renewable energy will become strategic opportunities. “Previously, we thought solar was cheap, but after the war, Europe’s concern is no longer cost but survival—whether its manufacturing system can endure.” Third, the strategic value of energy will rise systemically—not only for oil but also for coal chemicals, coal, clean energy, and alternative energies, all trending upward.

He noted that China’s energy structure is already excellent, but evolution will be gradual. By 2030, fossil fuels will still account for about 74% of the energy mix; by 2040, still around 50%. “Traditional energy sources will remain strategically important for the next five to ten years,” he said. “Meanwhile, alternative, clean, and new energies, along with energy tech like controlled nuclear fusion and storage, are undergoing systemic revaluation—this is a new reassessment from the perspective of energy security.”

“With Compassion, Sow Tears”—Zhang Yidong: Hong Kong and A-shares Both Have Allocation Value, Hengke Short-term as Consumer Stocks

He believes that the recent volatility in A-shares and Hong Kong stocks since the beginning of the year is mainly due to overseas factors, not hindering China’s long-term market trend. This correction is more like “building up energy,” and crouching down might lead to a higher jump. Both markets are expected to reach new highs in the second half of the year.

Regarding the Hang Seng Tech Index, Zhang Yidong thinks its composition has not yet adapted to China’s new economic transformation and technological development pattern. Many high-tech and hard-tech companies listed in Hong Kong since last year have not yet gained significant weight in the Hang Seng Tech or Hang Seng indices. Currently, the Hang Seng Tech Index reflects 2010s technology, not the new tech of the 2020s. He jokingly calls it the “Hang Seng Traditional Internet & Consumer Index,” suggesting it should be viewed as consumer stocks, not pure tech.

Nevertheless, he considers the current Hang Seng Tech Index still worth buying. China’s economic recovery has strengthened the fundamentals of traditional internet sectors like e-commerce, gaming, and advertising. The damage from past internal competition and exhaustion has passed.

He remains optimistic about the long-term prospects of the Hang Seng Tech Index but sees mid-term momentum as insufficient. In the short term, at this level, he recommends treating it as consumer stocks or convertible bonds—worth buying. “With compassion, sow tears”—don’t expect too much, but don’t cut losses now either.

He believes the only reason to cut losses now is if the war drags into the end of the year, causing a global financial crisis—that would be an irrational decline.

**　**Zhang Yidong: War Reveals “Rigid Bubble” in US AI Stocks—Capital Shifts from “Storytelling” to “Bookkeeping”

On U.S. tech growth stocks, Zhang Yidong said 2026 is likely to be the year when risk premiums in the U.S. capital markets reverse. Since the 2008 subprime crisis, risk premiums have been at a historic high for 18 years.

He pointed out that even if a ceasefire leads to a rebound in U.S. tech stocks, the driving force will shift from “PowerPoint stories” to verification through “the three statements”—especially the sustainability of cash flow and clarity of business models. “Without this war, the rigid bubble in AI might not have cracked so quickly; but this war has deepened the cracks in that bubble.”

He also highlighted that the U.S. private credit market (about $3-4 trillion) has begun to experience ongoing defaults, further confirming the trend of risk premium reversal in U.S. assets.

**　Zhang Yidong: The Three Mountains Have Fallen—China’s Long Bull Market in Stocks Continues**

He stated that China’s stock market has overturned the “Three Mountains”—theories of economic collapse, technological failure, and retreat of private enterprises. These pessimistic narratives have now been disproved, and China’s stock market now has three core supports for a long bull run, with the most difficult phase behind.

He believes China’s economic bottoming and recovery are the core foundations for the stock market. A key sign is that the real estate sector has shifted from an “L-shaped vertical” to an “L-shaped horizontal,” entering a bottom zone.

He illustrated with data: since 2021, the decline in China’s real estate sales area, investment, and prices is similar to the phase of risk release in major overseas economies. Currently, rental yields in 100 Chinese cities have reached 2.4%, while the 10-year government bond yield is only 1.8%. This indicates rental yields are trending above risk-free yields. “Should you sell your house to deposit in the bank, or keep it for rental income? The answer is clear—deposit yields are lower.” This marks real estate entering a bottom phase.

With real estate stabilizing, structural opportunities in China’s economy are emerging “like spring after rain.” Whether it’s supply-side optimization from de-involution or new growth points quietly emerging, these will boost economic vitality like spring rain.

He emphasized that China’s long-term strength lies in its comprehensive capabilities, especially in the path of technological self-reliance and innovation. This round of technological innovation is not “copycat,” but a systematic breakthrough aimed at autonomous control—second only to the stock market’s support.

He also pointed out that under the policy of “continuing stability and active capital markets,” the government has the ability and willingness to maintain market stability. This will lead to ongoing reallocation of social wealth—shifting household savings, and attracting long-term funds like insurance, social security, pensions, enterprise annuities, and bank wealth management.

“China’s future hard assets and structural long bull are driven by domestic capital,” Zhang said, drawing an analogy: just as China’s real estate experienced nearly 20 years of a super bull from 1998 to 2020, the capital market will also form a virtuous cycle through resource optimization and improved efficiency.

In the face of current global turbulence, Zhang advised not to chase highs in the short term, but to think contrarily. When overseas factors cause market volatility and pessimism, be brave to buy; when market sentiment is euphoric, stay disciplined and avoid chasing. In the medium to long term, if a real “TACO moment” occurs in Q2—such as U.S. troop withdrawals and a ceasefire with Iran—markets will shift to risk-on, and risk appetite will further improve, favoring tech growth assets.

Zhang Yidong: Expect a New High in A-shares and Hong Kong Stocks in the Second Half—Using the “SMART” Framework to Explore Three Main Lines of Hard Assets

He expressed strong confidence in Hong Kong stocks, similar to A-shares, believing that after the U.S.-Israel-Iran conflict, Chinese assets will become more attractive for allocation. The recent volatility in A-shares and Hong Kong stocks since the start of the year is mainly due to overseas factors, not hindering China’s long-term trend. This correction is more like “building momentum,” and crouching down might lead to a higher leap. Both markets are expected to hit new highs in the second half.

He emphasized not to focus solely on one stock like Hengke. Using the SMART framework, he summarized China’s three main lines of hard assets:

First line: S—Security. Includes energy, strategic resources, gold. The strategic importance of energy is systematically rising. China’s energy self-sufficiency is 85%, far above Japan’s 16% and Europe’s less than 20%, with clear advantages.

Second line: MA—Manufacturing Abroad. China’s most competitive manufacturing sectors—such as engineering machinery, electrical equipment, home appliances, auto parts, chemicals, petrochemicals, medical devices—are not only strong domestically but also excel internationally. After being underestimated during domestic economic pain, the recovery of domestic demand and the expansion of exports have doubled valuations.

Third line: RT—R&D and High-tech. Includes AI, quantum computing, and strategic emerging industries like high-end equipment, new materials, new energy, robotics (0.05, 15.070, 0.33%), innovative medicine, aerospace, and future industries like quantum tech, hydrogen energy, controlled nuclear fusion, brain-computer interfaces, bio-manufacturing, embodied intelligence, and specialized small giants.

He summarized that whether in A-shares or Hong Kong stocks, China’s current position is only loosely connected with overseas and Western markets, with minimal downward risk—at most, a misjudged sell-off. But the resilience of upward movement can be somewhat understated because indices do not quickly or fully reflect China’s economic transformation and technological evolution. The three main lines under the SMART framework—security assets, manufacturing going global, and R&D-driven high-tech—are the key focus.