EMERGING MARKETS-FX steady, stocks set for weekly gains on global trade optimism

By Ragini Mathur and Purvi Agarwal

July 18 (Reuters) - Most emerging market currencies were steady on Friday while equities advanced, as optimism over some economic improvement in the U.S. and positive corporate earnings outweighed investor concerns over tariffs.

MSCI's global emerging markets stock index .MSCIEF was up 0.7% on the day and looked set to close the week with gains.

Heavyweight Asian stocks gained, with those in Taiwan .TWII up over 1% to a more than four-month high. TSMC 2330.TW, the world's largest contract chipmaker, gained more than 2% after posting a record quarterly profit on Thursday.

U.S. markets surged to new all-time highs overnight after key economic indicators, including retail sales and jobless claims, exceeded expectations, setting a positive tone for EM stocks.

Regional bourses advanced, with those in Hungary .BUX and Romania .BETI up 0.4% each. Polish stocks .WIG20 jumped 2.4%, on track for their biggest weekly rise since late April.

On the trade front, Thailand said it had made more proposals to the U.S. during talks, raising hopes among investors that deals can be reached before U.S. President Donald Trump's new August 1 deadline for imposing tariffs.

Markets were briefly rattled this week by a report that Trump was going to fire Federal Reserve Chair Jerome Powell soon, with the dollar index taking a hit, although it recovered losses after Trump denied the claims.

After gains on Thursday, the dollar index =USD was down 0.2% on Friday, lifting most EM currencies.

"The dollar had got to a point where it was much more expensive than usual and that trend changed this year," said Paul Jackson, global head of asset allocation research at Invesco EMEA.

"It probably will remain weak for at least the next year and probably beyond that, partly because it's expensive and partly because of the policies being put in place by the U.S. administration."

South Africa's rand ZAR= climbed 0.9%, while its stocks .JTOPI jumped 1.1%. The country was set to wrap up the two-day meeting of finance chiefs from the Group of 20.

Russia's rouble RUB= was 0.4% higher against the dollar, over-the-counter market data showed. The European Union reached an agreement on an 18th sanctions package against the country in another blow to its oil and energy industry.

Turkey's lira TRYTOM=D3 was 0.3% lower, while its stocks .XU100 fell 0.2%.

Emerging European currencies were largely flat against a higher euro.

MSCI's emerging markets currency gauge .MIEM00000CUS was little changed on the day, but was on track for its second consecutive weekly decline — its first back-to-back weekly loss since early April.

Meanwhile, Moody's is set to review its ratings on the Czech Republic, while Romania awaits minutes from its central bank's latest meeting.

HIGHLIGHTS:

** Ghana's central bank will discuss key rate in 10 days, governor says

** Vietnam outlines new financial reforms in bid for emerging market status

** Malaysia's June exports record surprise year on year fall of 3.5%

For TOP NEWS across emerging markets nTOPEMRG

For CENTRAL EUROPE market report, see CEE/

For TURKISH market report, see .IS

For RUSSIAN market report, see RU/RUB