LONDON, Oct 16 (Reuters) - Hungary's forint jumped to new seven-week highs on Tuesday and its bond yields and debt insurance costs plunged, benefiting from rising expectations of a vital IMF aid deal and the renewed global appetite for risky emerging market trades.

Investors have been cheered by a raft of positive economic data, including Germany's ZEW business sentiment survey while pinning hopes on an upcoming European summit that could advance plans to tackle Spanish and Greek debt ID:nF9E8JA00E

Above-forecast U.S. retail sales, robust earnings from the third-largest U.S. bank, Citi, and weekend Chinese data have also added to optimism about the global economy.

The momentum boosted higher yield assets across the board, with emerging equities up 0.5 percent posting their biggest daily gain so far in over two weeks .MSCIEF .

The forint EURHUF= rose for the sixth straight day, due to improved risk appetite and hopes a key IMF aid deal is on track. It rose 0.3 percent versus the euro and 5-year credit default swaps (CDS) eased one basis point to 262 bps, Markit said.

CDS collapsed 30 bps on Monday to June 2011 lows which Hungary attributed to investors' faith in an impending IMF deal

ID:nB3E8IR01D . ID:nL5E8LG52K .

"The market has raised its expectation of an IMF deal even though there is no concrete evidence that anything is really happening," said Societe Generale analyst Gaelle Blanchard. "The improvement in the external environment is helping a lot."

Budapest stocks surged to a seven-month high .BUX and domestic bond yields fell 15-20 bps while dollar bond yield spreads fell 7 bps to 302 bps over Treasuries, outperforming the broader EMBI Global dollar bond index 11EML .

"We see overseas investors buying: this is a hunt for yield and carry," a bond trader in Budapest said.

Turkish stocks jumped 0.9 percent to Nov 2010 highs, while a rise in oil prices boosted Russian equities 0.7 percent .IRTS .

Earlier, the Korean won hit a one-year high to the dollar

KRW= while other Asian currencies firmed to multi-month highs.

Emerging sovereign dollar bond spreads over U.S. Treasuries tightened to 284 bps, the narrowest in a month <11EML

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For GRAPHIC on MSCI emerging index performance 2012, see http://link.reuters.com/weh36s

For GRAPHIC on MSCI emerging Europe performance 2012, see http://link.reuters.com/jun28s

For GRAPHIC on MSCI frontier index performance 2012, see http://link.reuters.com/zyh97s

For CENTRAL EUROPE market report, see CEE/

For TURKISH market report, see .IS

For RUSSIAN market report, see RU/RUB ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

(Reporting by Sujata Rao. Editing by Jeremy Gaunt.)

((sujata.rao@thomsonreuters.com)(+44 20 7542 6176 sujata.rao.thomsonreuters.com@thomsonreuters.net)) 

 ((Emerging Markets Prices from Reuters  Equities                  Latest    Net Chg  % Chg  % Chg                                                      on year  Morgan Stanley     Emrg Mkt Indx   
  .MSCIEF
     999.68    +4.46   +0.45   +9.09   Poland          
  .WIG20
     2385.43    +8.21   +0.35  +11.24   Hungary         
  .BUX
      19248.48   +53.54   +0.28  +13.40   Romania         
  .BETI
      4839.20   +18.52   +0.38  +11.58   Russia          
  .IRTS
      1472.94    +6.12   +0.42   +2.70   South Africa    
  .JTOPI
    32500.67   +42.91   +0.13  +14.16   Turkey          
  .XU100
    70345.03  +575.30   +0.82  +37.21   China           
  .SSEC
      2098.81    +0.11   +0.01   -4.57   India           
  .BSESN
    18571.50  -142.05   -0.76  +20.17   Currencies              Latest    Prev    Local    Local                                      close   currency currency                                            % change % change                                                     in 2012  Czech Rep     
  EURCZK=
     24.91     24.90   -0.04    +2.55  Poland        
  EURPLN=
      4.09      4.09   +0.06    +9.22  Hungary       
  EURHUF=
    278.25    278.99   +0.27   +13.06  Romania       
  EURRON=
      4.58      4.58   +0.00    -5.57  Serbia        
  EURRSD=
    110.70    110.59   -0.10    -3.39  Russia        
  RUB=
        30.95     30.99   +0.13    +4.01  Kazakhstan    
  KZT=
       150.65    150.64   -0.01    -1.45  Ukraine       
  UAH=
         8.15      8.13   -0.20    -1.90  South Africa  
  ZAR=
         8.75      8.79   +0.46    -7.87  Kenya         
  KES=
        84.90     84.75   -0.18    +0.06  Israel        
  ILS=
         3.82      3.83   +0.34    -0.22  Turkey        
  TRY=
         1.81      1.81   +0.08    +4.20  China         
  CNY=
         6.26      6.27   +0.10    +0.48  India         
  INR=
        53.00     52.97   -0.06    +0.02  Brazil        
  BRL=
         2.04      2.04   -0.02    -8.50  Mexico        
  MXN=
        12.82     12.80   -0.12    +8.82  Debt                 Index   Strip Spd  Chg   %Rtn   Index   Sov'gn Debt   
  11EMJ
   EMBI+    263        -2   0.04   699.79   Currency percent change calculated from the daily U.S.  close at 2130 GMT.))

Keywords: MARKETS EMERGING