* U.S., China data support otherwise directionless trade
* Rouble steadies at new highs; rate rise talk intensifies
* Hungarian forint up after inflation data but CDS rises
By Sebastian Tong
LONDON, Dec 10 (Reuters) - Robust U.S. and China data
supported otherwise directionless emerging assets on Friday as
Russia's rouble steadied at a two-month high against its
dual-currency basket after a five-day rally.
Hungary's forint edged up after data affirmed expectations
of further interest rate rises but risk premiums to insure its
debt ticked higher ahead of Monday's parliamentary vote on the
country's controversial pensions overhaul.
Wall Street gains fuelled by better than expected jobless
claims data helped underpin sentiment despite gnawing anxiety
over the euro zone debt crisis. []
On Thursday, Fitch became the first ratings agency to strip
Ireland of its 'A' credit status. []
Emerging shares <.MSCIEF> were 0.02 percent softer by 1230
GMT while emerging sovereign debt <11EMJ> was also barely
changed at 232 bps over U.S. Treasuries.
"It's year-end trading with thin liquidity and investors are
reluctant to take a strong directional view going into year end
especially given the backdrop," said Elisabeth Gruie, emerging
markets strategist at BNP Paribas.
Chinese trade, bank lending and property investment figures
all point to healthy growth in the world's second largest
economy. []
The central bank move to hike banks' reserve rate for the
third time had little impact on risk appetite with observers
saying Beijing was voting for a milder form of monetary
tightening to rein in inflation. []
"The Chinese are still taking the soft view, taming the
velocity of money rather than hiking rates," notes BNP's Gruie.
The Thomson Reuters emerging European equities index
<.TRXFLDEEPU> was 0.3 percent higher.
Czech shares <> rose 0.8 percent, staying at five-week
peaks for second day in a row while Russian shares <>
firmed 0.4 percent on stronger oil prices.
Turkish shares <> were flat to languish at their
lowest levels in around a week.
ROUBLE, FORINT
Strong commodity prices kept the rouble aloft for its fifth
straight day against its dollar-euro basket <RUS=MCX>.
Expectations that the central bank will soon move to raise
rates from record low levels were heightened after the
International Monetary Fund (IMF) urged Moscow to tighten
monetary policy. []
"Talk of rate hikes are also supporting the rouble as
investors price the possibility of better interest rate
differentials," Tradition Analytics said in a client note.
Emerging currencies were mixed: the Czech crown dipped 0.2
percent to stay near 20-week lows against the euro <EURCZK=>
while the Israeli shekel <ILS=> edged to a 4-1/2 week high
against the dollar.
Poland's zloty is set to end the week 1.4 percent weaker
<EURPLN=> but Turkey's lira <TRY=> snapped a four-day losing
streak with investors shrugging off third quarter GDP figures
showing a smaller than expected expansion. []
Hungary's forint reversed Thursday's losses to rise 0.3
percent against the euro <EURHUF=>, emboldened by data showing
rising inflationary pressures. []
Markets are watching closely whether the central bank, which
surprised investors by raising rates last week, will follow up
with its new hawkish line on Dec 20.
Hungarian risk premiums, however, inched higher on
expectations parliament will approve reforms that will force
millions of private pension fund members to move onto the state
run pension system by Jan. 31.
Five-year credit default swaps for Hungary rose 7 bps to 394
bps from Thursday close, according to Markit.
(Additional reporting by Sujata Rao; Editing by Ruth
Pitchford)
