November 28, 2018 / 9:41 AM / 13 days ago

EMERGING MARKETS-Emerging shares hit near 10-day high on hopes of U.S.-China trade truce

* Asia stocks lead gains in emerging shares

* Russian stocks rise in face of sanction threats

* Fed chair Powell's speech in focus

By Agamoni Ghosh

Nov 28 (Reuters) - Emerging market shares climbed to their highest in nearly ten days on Wednesday as Chinese stocks led Asian markets higher after the White House signalled that a truce was possible in its trade war with Beijing.

White House economic adviser Larry Kudlow said on Tuesday that a meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping at a G20 summit was an opportunity to "turn the page" on the dispute.

The comments boosted sentiment a day after Trump said it was "highly unlikely" that he would accept China's request to hold off raising tariffs.

"What we are seeing today is an unwind of more negative positions after yesterday's fiasco including a positive signal from the U.S. markets where a lot of the negativity was back-handed," said Stephen Innes, Head of Trading Asia, Oanda.

"All eyes however, still remain on the dinner meet (between Trump and Xi) which is expected to drive the markets for the rest of the week," he added.

The MSCI's broader index for stocks rose 0.8 percent with heavyweights China , Hong Kong and Taiwan clocking gains of more than 1 percent.

Bourses in South Africa, Turkey and India , also gained between 0.7 percent and 1.5 percent.

Russia's stock market was another bright spot, up 0.50 percent as investors shrugged off the threat of EU sanctions on Russia over its maritime confrontation with Ukraine.

"Although the market remains sensitive to any sanctions headlines, we believe that the EU has limited capacity to damage the Russian financial markets," Credit Suisse analysts wrote in a note.

U.S. President Donald Trump told the Washington Post on Tuesday he could cancel a meeting with Russian President Vladimir Putin at the G20 summit but was awaiting the full report on the conflict.

The Russian rouble gave up earlier gains and weakened as the central bank pledged to resume regular buying of foreign currency for state reserves next year.

As the dollar clung to its recent gains, emerging currencies were more mixed. Turkey's lira strengthened 0.4 percent while South Africa's rand slipped 0.2 percent as data showed consumer confidence fell sharply in the third quarter.

The Chinese yuan fell to two-week lows as investors struggled with conflicting signals over the trade tensions.

Focus also remains on a speech by U.S. Federal Reserve Chairman Jerome Powell later on Wednesday as investors hope to gain fresh insights into the Fed's thinking on the speed and number of rate hikes in the current cycle.

In Eastern Europe, currencies gave up their initial gains as the euro weakened versus the dollar.

Warsaw's stock index gained 0.6 percent as Getin Noble , mired in a corruption scandal which shook Polish banks stocks earlier this month, reported a fall in third-quarter loss pushing its shares 6 percent higher.

For GRAPHIC on emerging market FX performance 2018, see tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance 2018, see tmsnrt.rs/2OusNdX

For TOP NEWS across emerging markets

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see (Reporting by Agamoni Ghosh in Bengaluru; Editing by Andrew Heavens)

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