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China Stocks Priced for Hard Landing Signal Rally to Brokers

The lowest Chinese stock valuations since economic growth collapsed three years ago are a sign to the nation’s biggest brokerages that it’s time to buy.

The Shanghai Composite Index’s 6.2 percent retreat this quarter sent the gauge to 11.6 times estimated profit, data compiled by Bloomberg show. It took the global financial crisis and a decline in China’s growth rate to a seven-year low of 6.8 percent to push valuations this low in November 2008. The Shanghai gauge rebounded 49 percent in the next six months.