CEE MARKETS 2-Zloty, forint lead FX rebound, stocks up

                                
 * Zloty, forint lead rebound, stocks gain 1 percent
                                
 * Dealers say moves a correction, still see pressure
                                
 * Hungary bond yields drop, stay well-off April lows
                                
 
  (Adds bonds, details)
                                
 By Jason Hovet
                                
 PRAGUE, May 18 (Reuters) - The Polish zloty strengthened on
Tuesday, firming below 4.0 to the euro as central European
currencies and stocks improved with other risk assets after the
latest bout of nerves over the euro zone.
                                
 Emerging Europe's currencies have been weighed down by
pressure on the euro, which fell to a four-year low against the
dollar on Monday over concerns fiscal measures could hurt growth
in the zone.
                                
 Dealers said the recovery in Europe's currencies looked to
be more of a correction than any change in sentiment and the
units were off morning highs by 0907 GMT.
 "The euro should gain a little today and this will also
support our emerging markets. We should see some strengthening,"
said a Warsaw-based currency trader.
                                
 "But the lack of confidence in the strength of the euro zone
is still there. The markets seem to have less trust in the ECB's
anti-crisis measures than they have in the Fed's measures."
                                
 The zloty <EURPLN=> gained 0.6 percent to bid at 3.987 per
euro, while Hungary's forint <EURHUF=> followed with a 0.6
percent rise. The Czech crown <EURCZK=> added 0.4 percent and
Romania's leu <EURRON=> 0.1 percent.
                                
 The euro <EUR=> traded slightly off its low hit early
Monday, while central European stocks <.PX> <.BUX> <.WIG20>
<.BETI> rose up to 1 percent and also pulled back from early
highs.

                                
 HUNGARY BOND YIELDS SWING LOWER
                                
 Emerging Europe assets mostly fell on Monday on concerns a
750 billion euro rescue package for indebted euro zone countries
could hurt the region's nascent economic recovery.
                                
 The European Union's eastern economies -- despite higher
growth potential and lower debt piles than the west -- are seen
as particularly vulnerable because of heavy dependence on demand
from western Europe for their exports.
                                
 Greece, whose debt problems raised contagion fears in
Europe, was due to receive 14.5 billion euros in aid from the EU
on Tuesday to help pay debt that matures on Wednesday that was
one of the prompts for the EU aid. [ID:nLDE64H0JH]
                                
 In Hungary, bond yields dropped around 10-20 basis points on
Tuesday, continuing its rollercoaster trade from the past month
but still 70-95 basis points above April lows.
 "The euro/dollar moves everything now, we can forget any
other factors like today's wage figures," one Budapest-based
fixed income trader said.
                                
  Hungary's gross average wages rose by 9.4 percent in annual
terms in March after a 0.8 percent rise in February, mainly due
to a public sector bonus payout. Analysts said the data was not
enough to influence monetary policy, which most think still has
room to be easier. [ID:nLDE64H0DC]
                                
 
--------------------------MARKET SNAPSHOT--------------------
Currency                    Latest   Previous Local    Local
                                
                                  close    currency currency
                                
                                           change   change
                                
                                           today    in 2010 
Czech crown      <EURCZK=>   25.439   25.539  +0.39%   +3.46%
Polish zloty     <EURPLN=>    3.996    4.021  +0.63%   +2.7%
Hungarian forint <EURHUF=>  277.15   278.75   +0.58%   -2.45%
Croatian kuna    <EURHRK=>    7.253    7.253   0%      +0.77%
Romanian leu     <EURRON=>    4.192    4.194  +0.05%   +1.08%
Serbian dinar    <EURRSD=>  101.14   100.61   -0.52%   -5.2%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond   CZ2YT=RR    -1 basis points to  108bps over bmk*
7-yr T-bond   CZ7YT=RR   +11 basis points to  +110bps over bmk*
10-yr T-bond   CZ9YT=RR    -1 basis points to  +97bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond   PL2YT=RR   +1 basis points to  +396bps over bmk*
5-yr T-bond   PL5YT=RR    -2 basis points to  +346bps over bmk*
10-yr T-bond PL10YT=RR    -3 basis points to  +278bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond   HU3YT=RR    -15 basis points to  +559bps over bmk*
5-yr T-bond   HU5YT=RR    -20 basis points to  +490bps over bmk*
10-yr T-bond   HU10YT=RR  -13 basis points to  +418bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1107 CET.
Currency percent change calculated from the daily domestic 
close at 1600 GMT.

For related news and prices, click on the codes in brackets: All
emerging market news [EMRG]
Spot FX rates
Eastern Europe spot FX <EEFX=>    Middle East spot FX <MEFX=>
Asia spot FX <ASIAFX=>       Latin America spot FX <LATAMFX=>
Other news and reports  
World central bank news [CEN]  Economic Data Guide <ECONGUIDE> 
Official rates [GLOBAL/INT]  Emerging Diary [EMRG/DIARY] 
Top events [M/DIARY]  Diaries [DIARY] Diaries Index [IND/DIARY] 
 (Reporting by Reuters bureaus, writing by Jason Hovet; editing
by Jason Webb)