Investors snap up China stocks 'priced for financial crisis'

Global investors have been snapping up cheap Chinese stocks as signs of a banking collapse recede, but economic data remains mixed.

The MSCI China index returned 17.5% in the three months to 12 August, compared to 6.4% from the MSCI Emerging Markets index.   A combination of cheap stocks and some data indicating stable growth has encouraged investors to position themselves in China. In addition, Russia's status as a no-go area for most Western investors is limiting other options.   Henderson Global Equity Income fund co-manager Ben Lofthouse has been steadily increasing his allocation to China to take advantage of low valuations.   "We have had the sense over the last few months that the government wants to stimul...