EMERGING MARKETS-Czech crown at 2009 high, Turkey up

                                
 * Czech crown hits 2009 highs, zloty firms on euro zone PMI
                                
 * Turkish stocks hit 19-mth high after this week's rate cut
                                
 * Emerging stocks, bonds steady as Chinese shares recover
                                
 
                                
 By Carolyn Cohn
                                
 LONDON, Aug 21 (Reuters) - Strong euro zone data took the
Czech crown to a 10-month high against the euro on Friday, while
Turkish stocks hit their highest since January 2008 on
expectations of more growth-boosting rate cuts.
                                
 Most emerging markets were slightly firmer on recovering
Chinese stocks.
 The mood in emerging markets has been tied to the fortunes
of Chinese shares this week, with China volatile on concern
about monetary tightening. The Shanghai stock index <.SSEC> hit
two-month lows this week but has since recovered by more than 7
percent.
                                
 "It's been a topsy-turvy week but the mood today is good
although volumes are still thin. The headlines about the end of
recession are helping and especially constructive for the Czech
and Polish markets, which are seen as the more resilient in
emerging Europe," said Richard Segal, director, emerging markets
research at Knight Libertas.
                                
 "I expect China to continue to worry investors as the
central bank there is more likely than others to clamp down on
credit creation to prevent an asset bubble from forming."
                                
 Benchmark emerging equities <.MSCIEF> hit their highest
since Monday, up 0.2 percent, and emerging sovereign debt
spreads tightened by 4 basis points to 378 bps over U.S.
Treasuries <11EMJ>.
                                
 The euro zone economy probably crawled back to growth this
quarter after its worst recession on record, key surveys showed
on Friday. [nLL381566]
                                
 The Czech crown hit the year's high against the euro
<EURCZK=>, while Polish stocks <.WIG20> rose over 3 percent to
10-month highs and the zloty rose half a percent to a one-week
high against the euro <EURPLN=>.
                                
JPMorgan raised Czech, Hungarian and Polish stocks to
overweight from underweight, the bank said on Friday.
[nWNAB2536]
                                
 
                                
 TURKEY RATES
                                
 Turkey's central bank cut interest rates this week to a
record low of 7.75 percent and said further measured cuts would
be necessary if no significant signs of economic recovery
appeared.
                                
  Turkish stocks <.XU100> hit 19-month highs on Friday before
trimming gains to trade steady on the day, and the benchmark
2011 domestic bond yield hit a new record low.
                                
 The lira gained 0.3 percent against the dollar <TRY=>,
within recent ranges.
                                
 Hungarian markets were shut for a holiday on Friday, but
investors are also looking to an interest rate cut on Monday.
                                
 "Hungarian and Turkish swap rates are down roughly 15 bps on
increased risk appetite and on speculation about more rate cuts
from both central banks," said analysts at Danske in a client
note.
                                
 "We look for a 50 bps cut to 8.00 percent from the Hungarian
central bank, but keep in mind that the central bank surprised
us at their last meeting, when they cut 100 bps."
                                
 Emerging market rate cuts are boosting local markets. The
rand <ZAR=> traded at two-week highs after the central bank also
cut rates by 50 bps this week, to a four-year low of 7.0
percent.
 (Additional reporting by Sebastian Tong; Editing by Jon Boyle)