* Stocks rise slightly, spreads narrow as euro steadies
* Lira firm ahead of Turkey rate decision, no change seen
* Albania, other potential issuers awaiting better markets
By Carolyn Cohn
LONDON, May 18 (Reuters) - Emerging market stocks and bonds
edged up on Tuesday, tracking the euro which steadied after
plumbing four-year lows on Monday, while Turkish assets were
firm ahead of a central bank meeting that was expected to leave
rates on hold.
Emerging Europe has been caught up in the euro zone debt
crisis as the region's fortunes are closely linked to those of
the euro zone, a major trading partner.
However, fears about the impact of the crisis eased slightly
as debt-laden Greece received 14.5 billion euros in aid from the
EU on Tuesday, and euro zone finance ministers said they were
working to iron out wrinkles in their 750 billion euro markets
stabilisation package.
Markets were sanguine about a larger-than-expected drop in
the German ZEW economic sentiment survey for May.
"From a long-term perspective the decline in the ZEW was not
huge. Germany is still holding up and that's an okay environment
for central Europe," said Gyula Toth, emerging markets
strategist at Unicredit in Vienna. However, he said he favoured
the Turkish lira over emerging European currencies.
"We like the lira as opposed to (central European
currencies). We expect 125 bps in hikes (by year-end) but if you
consider that no one else will hike it's quite good."
The Turkish lira rose 0.45 percent <TRY=> and Turkey's
five-year credit default swaps fell 5 basis points to 175.1 bps
according to data monitor CMA DataVision ahead of the rate
decision, expected to result in unchanged rates of 6.5 percent.
Benchmark emerging equities <.MSCIEF> rose 0.4 percent and
are trading in the middle of recent wide ranges.
Emerging sovereign debt spreads tightened by 2 basis points
to 294 bps over U.S. Treasuries <11EMJ>. Malaysia starts a
roadshow this week for a $1 billion global sukuk, its first
international bond since 2002. []
There are around 20 emerging sovereigns, banks and
corporates who are roadshowing or planning to launch Eurobonds,
one syndicate source said, but most issuers are waiting for more
favourable conditions following recently volatile markets.
Argentina, Albania, Montenegro, Macedonia and Ukraine are
among those looking to launch international bonds.
Ukraine mandated JPMorgan, Morgan Stanley and VTB Finance on
Monday to issue a Eurobond, which investors expect to have a
10-year maturity.
Ukraine's five-year credit default swaps, used to insure
against restructuring or default of debt, are trading below 600
basis points and are once more below those of Greece.
Ukraine is also seeking a package of up to $19 billion from
the International Monetary Fund.
"It's easier to get money from the markets than from the
IMF," said Richard Segal, analyst at Knight Capital.
(Additional reporting by Sujata Rao; Editing by Susan
Fenton)
