* MSCI EM stocks index at highest level since late-Feb
* Russian stocks among top gainers for the day
* Turkish lira under pressure from higher inflation
By Ambar Warrick
July 6 (Reuters) - Emerging-market stocks reached their highest in more than four months on Monday, extending gains into a fifth session as strong economic data spurred bets on a swift economic recovery.
The MSCI's index of developing-world stocks .MSCIEF rose 1.8% to its highest since Feb. 26, with Chinese stocks the biggest boost to the index as the country's business activity recovered steadily.
Strong economic readings from the United States and China last week had restored a measure of risk appetite, helping markets weather an increase in COVID-19 cases and concern over new lockdown measures in the developed world.
Russian stocks .IMOEX .IRTS led gains among markets in Europe, the Middle East and Africa, on strength in its energy sector. Rising oil prices have helped Russian exporters, as well as the rouble RUB= .
"With an unprecedented amount of cash in the system, equities and high-yielding bonds are attracting a lot of interest from investors in the absence of acceptable yield from money markets and longer-term government bonds," Hussein Sayed, chief market strategist at FXTM, wrote in a note.
"To keep this rally alive, we need more intervention from fiscal and monetary policymakers and for investors to believe that policies will be generous enough to provide further liquidity."
Emerging-market currencies have diverged from equities over the course of the pandemic, with monetary stimulus measures also hurting returns from FX and fixed income.
Equities have been quicker to recover from the rout thanks to increased cash in the market, leaving currencies in a trough. This was reflected in the day's movement, with most emerging- market currencies gaining little support from the increased risk appetite.
Russia's rouble sank about 1% to the dollar due to local dollar demand, as well as the threat of possible British sanctions.
Turkish stocks .XU100 added about 1.7%, while the lira TRY= was flat to the dollar. The currency is likely to face more selling pressure as Turkey struggles to rein in higher inflation bought about by the coronavirus outbreak.
Turkey's central bank had held rates last month, citing upward price pressures caused by the pandemic.
Central European stocks rose while the Hungarian forint EURHUF= and Polish zloty EURPLN= were in a flat-to-low range against the euro.
For GRAPHIC on emerging market FX performance in 2020, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2020, see https://tmsnrt.rs/2OusNdX
For TOP NEWS across emerging markets CENTRAL EUROPE market report, see CEE/
For TURKISH market report, see .IS
For RUSSIAN market report, see RU/RUB
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Turkish lira and domestic inflation
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