LONDON, Oct 20 (Reuters) - Chinese mainland shares touched two-month highs on Tuesday as investors bet on more stimulus following the recent raft of lacklustre data, but the gains did not extend to broader emerging equities.
Chinese indexes in Shanghai and Shenzen rose more than 1 percent to the highest since late August.
But MSCI's main emerging equity index slipped 0.4 percent, dragged lower by a subdued performance in Hong Kong .
China's third quarter GDP data on Monday was slightly better-than-expected at 6.9 percent, but not so strong that it would head off further stimulus measures. This could account for the bounce in Chinese stocks, said William Jackson, senior emerging markets economist at Capital Economics.
"There were concerns about a slowdown in China and debt levels in emerging markets and looking at the data, some of the sell off seemed a bit excessive," Jackson said, adding upcoming growth data from emerging markets would show if the sell off reflected the economic reality.
China will launch its first overseas "dim sum" renminbi bond from London later on Tuesday, with initial guidance at 3.3 percent for the one-year issue. The net proceeds from the unrated, fixed-rate, senior unsecured notes will be used to support the Chinese central bank's functions.
Axa IM's head of Asian fixed income Jim Veneau said in a note that this level was attractive since 10-year onshore bonds yielded only 3 percent.
Currency performance was mixed despite dollar weakness.
The lira and the rand both firmed 0.5 percent but Asian currencies such as the ringgit and rupiah slipped around 1 percent against the dollar, to near two-week lows as they felt the heat from China's slowdown fears.
The Hungarian forint was flat against the euro though it could weaken if the central bank's policy meeting later in the day yields a dovish message after the recent fall in inflation.
One key risk for emerging markets is the possibility of contagion from Brazil, where Finance Minister Joaquim Levy is under heavy pressure as he tries to push through vital austerity measures.
Brazilian bond yield spreads over U.S. Treasuries were stable on the EMBI Global index after jumping 20 basis points on Monday.
Brazil's central bank, which starts a two-day meeting on Tuesday, is expected to hold interest rates at 14.25 percent despite rising inflation expectations.
For GRAPHIC on emerging market FX performance 2015, see link.reuters.com/jus35t
For GRAPHIC on MSCI emerging index performance 2015, see link.reuters.com/weh36s
For GRAPHIC on MSCI emerging Europe performance 2015, see link.reuters.com/jun28s
For GRAPHIC on MSCI frontier index performance 2015, see link.reuters.com/zyh97s
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see ) (Editing by Mark Potter)