EMERGING MARKETS-Emerging stocks set for biggest weekly rise since March

By Karin Strohecker

LONDON, July 1 (Reuters) - Emerging stocks headed for their

biggest weekly gain since March on Friday, shrugging off Brexit

jitters and focusing on the likelihood of more central bank

stimulus, though concerns over the global economy weighed on

some currencies.

MSCI (NYSE: MSCI - news) 's emerging equity index rose 0.4 percent as

their fourth straight day of gains more than offset steep losses

suffered in the wake of Britain's June 23 vote to leave the

European Union.

Bourses in Asia , emerging Europe

and Turkey chalked up solid gains,

even though economic data cast doubt over the health of the

world's big economies.

Growth in China's manufacturing sector stalled in June,

adding to expectations that Beijing will roll out more stimulus.

Purchasing Manager Index (PMI) data from Malaysia, Turkey,

Poland, Hungary and the Czech Republic showed factory activity

growth slow or even contract sharply.

"In emerging Europe, the PMIs provide further evidence that

growth slowed in Q2, even before the UK's vote for Brexit," said

William Jackson from Capital Economics in a note. "The surveys

brought bad news, with Turkey's PMI particularly disappointing."

Yet with bond yields trending lower in Europe and the United

States, and receding U.S (Other OTC: UBGXF - news) rate rise prospects, emerging assets

found support from yield-hungry investors.

"The environment will be broadly supportive but there are

areas you want to be in and others you want to avoid, you want

to be in EMs where inflation is coming lower, which allows

central banks to ease policy," said Kiran Kowshik, EM strategist

at UniCredit (EUREX: DE000A163206.EX - news) , singling out Asia and Russia.

Yet on the day, data showing Russian manufacturing activity

growing in June for the first time since November failed to

offset the fall in oil prices which sent the rouble

0.7 percent lower. But the currency was set for a weekly

gain against the dollar.

The Turkish lira slipped half a percent as did South

Africa's rand but both were on track for weekly gains.

Poland's zloty and Hungary's forint

weakened 0.4 percent, but both headed for weekly gains.

Investors in Poland are awaiting the outcome of ratings

agency S&P Global (NYSE: SPGI - news) 's latest assessment, which holds a negative

outlook on the country. S&P will also publish its verdict on

Serbia.

Emerging Markets Prices from Reuters

Equities Latest Net Chg % Chg % Chg

on year

Morgan Stanley (Xetra: 885836 - news)

Emrg Mkt Indx 836.39 +2.29 +0.27 +5.32

Czech Rep 817.89 +0.98 +0.12 -14.48

Poland 1739.61 -11.08 -0.63 -6.43

Hungary 26344.79 +19.19 +0.07 +10.13

Romania 6516.73 +43.32 +0.67 -6.96

Greece 544.38 +2.26 +0.42 -13.78

Russia 925.86 -4.91 -0.53 +22.30

South Africa 45636.31 -338.00 -0.74 -0.35

Turkey 77511.70 +694.51 +0.90 +8.06

China 2932.82 +3.22 +0.11 -17.13

India 27163.88 +164.16 +0.61 +4.01

Currencies Latest Prev Local Local

close currency currency

% change % change

in 2016

Czech Rep 27.08 27.06 -0.05 -0.29

Poland 4.40 4.38 -0.42 -3.13

Hungary 316.54 315.25 -0.41 -0.60

Romania 4.51 4.52 +0.22 +0.17

Serbia 123.35 123.25 -0.08 -1.52

Russia 64.08 63.75 -0.52 +13.84

Kazakhstan 338.07 339.06 +0.29 +0.72

Ukraine 24.82 24.81 -0.02 -3.48

South Africa 14.72 14.68 -0.27 +5.04

Kenya 101.00 101.00 +0.00 +1.19

Israel 3.85 3.85 +0.07 +1.01

Turkey 2.89 2.88 -0.52 +0.88

China 6.66 6.65 -0.20 -2.51

India 67.39 67.49 +0.16 -1.76

Brazil 3.21 3.21 +0.06 +23.32

Mexico 18.29 18.27 -0.14 -6.14

Debt Index Strip Spd Chg %Rtn Index

Sov'gn Debt EMBIG 411 5 .08 7 44.38 1

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 )

(Additional reporting by Sujata Rao; Editing by Andrew Heavens)