* EM stocks set for biggest one-day fall this year
* Mueller report outcome buoys Russian stocks and rouble
* Turkish lira recovers after Friday's brutal sell-off
By Agamoni Ghosh
March 25 (Reuters) - Emerging market stocks fell on Monday, tracking a global-sell off with investors ditching shares and piling into the safety of bonds on concerns over slowing global growth and fears of a U.S. recession.
The U.S. dollar took a back seat, lifting most developing world currencies with Turkey's lira TRY= in recovery mode after plunging as much as 5 percent in the previous session. FRX/
Weak economic data from Europe triggered a worldwide sell-off on Friday which worsened after more disappointing numbers from U.S. came in, fanning global growth fears.
The U.S. yield curve inverted on Friday for the first time since mid-2007, the strongest indication of a possible recession for the world's largest economy. US/
"The fact that Fed turned dovish and suddenly we had disappointing data brought back the bears," said Trieu Pham, EM Credit Research at ING.
MSCI's index for emerging market shares fell .MSCIEF 1.4 percent, on track to record its biggest one-day fall this year with indices falling across the board led by Asia.
Stocks on Moscow's MOEX index .IMOEX recovered marginally from initial falls, while the rouble RUB= rose 0.3 percent as the market digested a much-anticipated U.S. report on Russian interference in the 2016 U.S. election.
A 22-month long investigation led by Special Counsel Robert Mueller ended with a finding that no one in President Donald Trump's campaign "conspired or coordinated with the Russian government" in the 2016 election. it should be supportive if we now assign a slightly lower likelihood of sanctions (on Russia)," said Guido Chamorro, portfolio manager at Pictet Asset Management.
Most currencies in the developing world benefited from the dollar's undermined position fanned by inversion of the U.S. bond yield curve.
Turkey's lira managed to bounce back 2 percent after Friday's more than 5 percent tumble, with the central bank pledging to strengthen reserves and manufacturing confidence rising. recent statement from the central bank was better than 2018 but its still lacking a more stronger action," said Per Hammarlund, chief EM strategist, SEB.
"The banking regulator needs to be more clear on what they will do with bad loans, the non-performing loans in the economy," he added.
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