* Emerging markets underperform global stocks
* Polish zloty rises after ratings comment
By Natsuko Waki
LONDON, Sept 16 (Reuters) - Emerging market stocks fell on
Thursday after this week's rally brought the index to a 4-1/2
month peak, while the Polish zloty outperformed other currencies
after positive comments from a ratings agency.
Central European stocks were slightly lower to steady
<.MIEE00000PUS> <.TRXFLDEEPU> while broader emerging market
stocks, measured by MSCI <.MSCIEF>, lost half a percent. The
benchmark world equity index lost almost 0.2 percent.
"Sentiment has been quite good recently because
macroeconomic numbers especially in emerging markets are
starting to look better now again. Today it's mixed because
people are taking a pause," said Flemming Nielsen, senior
emerging market analyst at Danske Bank in Copenhagen.
The Polish zloty rose a quarter percent against the euro to
3.93 <EURPLN=> after ratings agency Moody's said there was
upward pressure on ratings in Poland.
Moody's has an A2 rating for Poland with a stable outlook.
Poland is battling rising debt and both Moody's and Fitch have
said reforms were needed to safeguard the country's rating.
Poland was the only one in the EU that has not suffered a
recession during the crisis, with deputy finance minister Ludwik
Kotecki saying on Wednesday that third-quarter growth would come
in at around 3.5 percent.
POLAND VS HUNGARY
Poland priced its 10-year euro-denominated bond issue worth
1 billion euros at 120-125 basis points above mid-swaps and
investor demand for the 10-year paper topped 4 billion euros.
"It's at the right time, prices have been cheapening, and
the country has this benign perception. it's the opposite of
what we are seeing in Hungary," Elisabeth Gruie, strategist at
BNP Paribas.
"We have a decoupling between these two countries. The
zloty/forint should go higher."
The Hungarian forint fell a fifth of a percent to 282.40 per
euro <EURHUF=>, a day after two leading ratings agencies warned
of risks stemming from the country's fiscal deficit.
Moody's said on Wednesday it could downgrade Hungary's
sovereign rating if the government fails to present a consistent
plan to address fiscal issues.
Standard & Poor's said Hungary's commitment to the European
Union's deficit requirements is insufficient to revise its
negative ratings outlook.
Hungary plans to sell foreign currency-denominated bonds
worth 4 billion euros and forint-denominated bonds worth 1.485
trillion forints in 2011.
"More solid medium term fiscal and economic policy anchors
are needed. We struggle to see value in Hungarian government
bonds at current levels, especially with the higher planned net
issuance for 2011," Societe Generale said in a note to clients.
The Turkish lira fell around 0.3 percent to 1.4906 per
dollar <TRY=> after data showed domestic consumer confidence
eased again in August, extending a retreat from a June peak
following seven months of improvement.
The central bank is expected to leave interest rates on hold
at its monthly meeting later.
On Wednesday, S&P forecast Turkish economic growth in excess
of 8 percent in 2010, noting the country's strong domestic
demand-driven upturn was driving up the current account deficit.
S&P, which rates Turkey two notches below investment grade,
reiterated that the "positive outlook" it held on Turkey
signalled the likelihood of an upgrade in the next 12-24 months.
(Additional reporting by Carolyn Cohn; editing by Chris Pizzey)
