EMERGING MARKETS-EM stocks plunge, headed for steep weekly loss as Fed policy jitters build

By Nikhil Sharma

Nov 21 (Reuters) - Emerging Market stocks crashed on Friday, tracking a dramatic global selloff after U.S. jobs data failed to quell uncertainty about the Federal Reserve's policy path, even trampling optimism from Nvidia's impressive earnings.

MSCI's index for emerging market equities .MSCIEF tumbled 2.7%, on pace for its worst week since April 7, when U.S. tariff announcements triggered a global market rout.

The MSCI emerging Asia stock index .MIMS00000PUS slid 3%, influenced by Wall Street, where major indexes swiftly reversed course on Thursday despite an early boost from Nvidia's upbeat forecast, as concerns about a potentially overvalued AI sector resurfaced.

"It was easier to recover from the tariff slump in stocks, since one man, President Trump, had to do one thing, reduce tariffs, for stocks to recover," Kathleen Brooks, research director at XTB, said in a note.

"This time it's different. There is no single thing that needs to change; the market instead has buyer’s remorse over pushing tech stock valuations too high, and this will take time to work its way out of the system.

Meanwhile data showed the U.S. added more jobs than expected in September, while a rise in the unemployment rate and downward revisions to prior months together fueled uncertainty around whether Fed policymakers will cut rates next month.

An index of emerging market FX .MIEM00000CUS weakened 0.3% - on track for its worst week since late July - as investors assessed progress towards a peace deal to end the Russia-Ukarine war.

Ukraine's international bonds extended gains on Friday ahead of an expected meeting between Ukrainian officials and a U.S. delegation to hammer out peace terms.

The 2034 maturity note XS2895056013=TE was up 1.1 cents to bid at 56.62 cents on the dollar.

A data-light week in Central-Eastern Europe, had Hungary's policy decision as a key highlight. The Hungarian central bank delivered an expected pause in the base rate at the European Union's joint-highest level of 6.5%, amid fears of fiscal loosening and an uncertain inflation outlook.

The forint EURHUF= dropped 1% on Friday, on track to erase early-week gains. The main stock index .BUX lost 0.9%.

The Czech koruna EURCZK= eyed its worst week since May, down 0.2% on the day, while Prague's main stock index .PX shed 1.1%.

Moves in Polish stocks this week were dictated by a flood of corporate earnings alongside global sentiment. Warsaw's benchmark index .WIG20 fell 3.1% on the week.

Quarterly results from Poland's largest e-commerce company Allegro ALEP.WA and media and telecoms group Cyfrowy Polsat CPS.WA disappointed, while state-controlled energy group Orlen's PKN.WA third-quarter profit jump also failed to lift investor confidence.

The Polish zloty EURPLN= dropped 0.4% on Friday, set for its worst week since early June.

Elsewhere, U.S. President Donald Trump on Thursday removed his 40% tariffs on Brazilian food products, including beef, coffee, cocoa and fruits that were imposed in July over the prosecution of its former president and Trump ally Jair Bolsonaro.

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