A rally in Chinese stocks since mid-September has bolstered emerging market ETFs as the country gears up for its once-in-a-decade leadership transition.

The iShares FTSE China 25 Index Fund (NYSEArca: FXI) has pulled back the past three sessions but the 50-day moving average has passed above the 200-day average in a so-called bullish cross. Trading volume in the ETF has picked up recently.

XLI, the biggest Chinese exchange-traded fund in the U.S., climbed to a six-month high as expanding factory output added to signs the economy is awakening from a seven-quarter slowdown, Bloomberg News reported. [Comparing Two ETFs for China]

“Investors were looking for some signs of stabilization in the growth, and the purchasing managers’ index is one of those signs,” Audrey Kaplan of Federated InterContinental Fund at Federated Global Investment Management, said in the report. “People’s confidence in Chinese equities is picking up. It looks like the beginning of a rally.” [Emerging Market ETFs Outperform on China Rally]

Chinese manufacturing rose for the first time in 3 months on rising output and an influx of new factory orders. Both industrial production and retail sales rose for the first time in 6 months. The undervalued yuan is currently bolstering the edge that China has in trade markets. [ETF Spotlight: China]