EMERGING MARKETS-Bull run thunders on as Russia stocks hit record high

By Marc Jones

LONDON, Aug 16 (Reuters) - A thundering bull run in emerging

markets had investors polishing their horns on Tuesday as record

high Russian stocks and a two-year peak in Brazil echoed broad

EM FX and bond gains.

MSCI (NYSE: MSCI - news) 's closely-followed 27-country EM share index

ground out its latest one-year high as it climbed for a seventh

day in nine, and its rally since January moved past the 33

percent marker.

Moscow's rouble-denominated MICEX stock market

underscored the power of the uplift as oil creeping back towards

$50 a barrel helped it shrug off fighting in Ukraine to

hit an all-time high.

EM currencies meanwhile took advantage of a dollar heavily

subdued by fresh signs that U.S (Other OTC: UBGXF - news) . interest rates are likely to

stay put this year.

The greenback was having its worst day of the month, which

allowed South Korea's won to press a 15-month high,

Brazil's real to touch a one-year high and Mexico's peso

to climb to its highest since May, among others.

"It (Other OTC: ITGL - news) 's summer, it's quiet and the market is rallying these

are the important things," said Aberdeen Asset Management (Other OTC: ABDNF - news) 's

Viktor Szabo.

"We are basically now waiting for a wall of (bond) issuance

in early September and you have to say the environment is

perfect," he said, adding that major players like Saudi Arabia

and Russia may all be looking to sell debt.

Russia's Finance Ministry will decide in the autumn whether

to top up sovereign Eurobond issue, Konstantin Vyshkovsky, head

of the ministry's debt department, told Reuters.

Among the other few pieces of hard news, Zambia's currency,

the kwacha, rose 2.5 percent to 10.06 against the dollar

after President Edgar Lungu narrowly won re-election on Monday,

though his main rival warned the vote had been rigged.

Zambia is Africa's second biggest copper producer but the

kwacha slid around 20 percent between April and July, and Lusaka

has been in talks about a support deal with the International

Monetary Fund.

"We had Lungu winning but as always there will be an appeal

from the opposition," said Aberdeen's Szabo. "The problem is

with any contested election; if they become really close, you

can have some noise."

There was reassuring news for big central European economies

like Poland, the Czech Republic and Hungary, meanwhile, as

investor morale in Germany, their biggest export partner, picked

up slightly after taking a hit by Britain's June Brexit vote.

The Czech economy also grew a touch faster between April and

June than had been forecast, Prague said, expanding 0.9 percent

in the second quarter and 2.5 percent year-on-year.

"Economic sentiment is recovering somewhat from the Brexit

shock," German ZEW President Achim Wambach said. "Political

risks within and outside the European Union, however, continue

to inhibit a more optimistic economic outlook for Germany."

Turkish stocks drifted lower after reports that

Turkish police had simultaneously raided 44 companies in

Istanbul and had warrants to detain 120 company executives as

part of the investigation into last month's attempted military

coup.

Since the coup, more than 35,000 people have been detained,

of whom 17,000 have been placed under formal arrest, and tens of

thousands more suspended in a purge of Turkey's military,

law-and-order, education and justice systems.

The Turkish lira was at a post-coup attempt high of

2.993 per dollar.

Emerging Markets Prices from

Reuters

Equities Latest Net Chg % Chg % Chg

on year

Morgan Stanley (Xetra: 885836 - news)

Emrg Mkt Indx 918.13 +2.27 +0.25 +15.61

Czech Rep 859.65 -1.65 -0.19 -10.11

Poland 1847.54 -10.16 -0.55 -0.62

Hungary 27696.46 -172.33 -0.62 +15.78

Romania 6845.59 +56.54 +0.83 -2.27

Greece 574.05 -2.07 -0.36 -9.08

Russia 986.09 +13.99 +1.44 +30.26

South Africa

45766.39 +462.51 +1.02

-0.07

Turkey 78200.21 -272.35 -0.35 +9.02

China 3110.48 -14.72 -0.47 -12.11

India 28071.92 -80.48 -0.29 +7.48

For GRAPHIC on emerging market FX performance 2016, see http://link.reuters.com/jus35t

For GRAPHIC on MSCI emerging index performance 2016, see http://link.reuters.com/weh36s

For GRAPHIC on MSCI emerging Europe performance 2016, see http://link.reuters.com/jun28s

For GRAPHIC on MSCI frontier index performance 2016, see http://link.reuters.com/zyh97s

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see )

(Editing by Mark Heinrich)