EMERGING MARKETS-Strong growth data lifts emerging stocks to 5-1/2-yr high

By Sujata Rao

LONDON, Jan 2 (Reuters) - Emerging stocks surged one percent on Tuesday to the highest in 5-1/2 years, lifted by a weak dollar, data indicating robust economic growth and bullish commodities.

Many emerging market country currencies also hit multi-week peaks.

The first trading day of the year saw emerging stocks and bonds extend the previous year's gains, especially after purchasing manager surveys in Asia showed Chinese December manufacturing at the strongest in four months. Those in some other markets such as India and Taiwan (Taiwan OTC: 6549.TWO - news) hit multi-year highs .

In emerging Europe, Hungary's PMI recorded its strongest December, Czech data was at the highest since 2011 while Turkey's rose for a 10th straight month.

"Some of the PMIs have been really strong and in central/eastern Europe we have seen some of the strongest numbers on record. So it looks like 2017 ended on a strong note in growth terms and that's translating into better sentiment on markets," said William Jackson at Capital Economics.

Most emerging currencies firmed, led by the yuan which approached a four-month high to the weak dollar while in emerging Europe, the Turkish lira, Russian rouble, Polish zloty, Hungarian forint all hit multi-month highs to the greenback , rising by half a percent or more.

Asian shares rose to a new decade-high and Turkish markets jumped more than 1 percent.

Jackson said, however, the strength of the data indicated more central banks would move towards policy tightening, emulating countries such as the Czech Republic and South Korea which have already raised rates. That could signal that emerging stocks have already peaked in dollar terms, he warned.

"We have seen a slow shift in that direction already, I think Poland will need to follow suit this year. But on the other hand inflation is still fairly low, with some exceptions," Jackson added.

That should be confirmed later in the day in Poland where inflation is expected to slip back after a rise in November caused by food prices. Turkish inflation due on Wednesday may also show price growth had peaked in November.

For GRAPHIC on emerging market FX performance 2017, see http://tmsnrt.rs/2e7eoml For GRAPHIC on MSCI (Frankfurt: 3HM.F - news) emerging index performance 2017, see http://tmsnrt.rs/2dZbdP5

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see)

(Reporting by Sujata Rao; graphic by Karin Strohecker Editing by Jeremy Gaunt)