China’s surging stock market after the government outlined plans to boost the economy has suddenly tipped hedge funds and strategists to what would have recently been seen as one of the most contrarian trades around. The CSI 300, an index of stocks traded in Shanghai and Shenzhen, rallied more than 15% last week, its best week since 2008 . Earlier this year, the CSI 300 fell to six-year-lows. “There is no question that shares of quality businesses will bottom well ahead of final index bottoms,” a team led by JPMorgan chief China equity strategist Wendy Liu wrote in a report Friday. Until the government’s measures pan out, investment strategists are recommending a handful of oversold stocks in China. JPMorgan highlighted three stock picks for near-term upside: Shanghai-listed beer company Tsingtao , U.S.-listed retailer Miniso and machinery company Zhejiang Dingli, also traded in Shanghai. “Our focus here and over the next several quarters will be on finding quality businesses that trade at undemanding valuation[s],” the report said. Adding exposure That newfound enthusiasm was contagious. “We believe it is a good time to add back China exposure,” Rupal Agarwal, director, Asia quantitative strategist at Ber …
