EMERGING MARKETS-Stocks soar on hopes for turning point in U.S.-China trade deal

* EM stocks climb to highest level since June 2018

* Shares in China, Hong Kong, S. Korea add over 1%

* South African equities rise for fifth straight session

* Trading in currency markets remains muted

* Hungarian forint eases ahead of central bank meeting

Dec 17 (Reuters) - Emerging market shares jumped on Tuesday, with Russia hitting a record high, powered by hopes that an initial U.S.-China trade deal will mark a turning point in one of the major risks to global economic growth.

Increasing risk appetite drove an index of developing world stocks up 1.1% to its highest level in one-and-a-half-years, with shares in China ending up 1.3% after topping a three-month high.

Global investor confidence has improved since the world’s top two economies said on Friday they had arrived at the much-awaited “phase one” trade agreement, which suspended tariffs due to take effect on Dec. 15. It is also expected to double U.S. exports to China.

On Tuesday, Bloomberg reported sources as saying that China would provide tariff waivers to buyers of U.S. farm products on a more regular basis.

“Political decisions will continue to impact markets significantly in 2020,” said Mark Haefele, chief investment officer at UBS Global Wealth Management. “In the near term, volatility could be heightened as the details of what is included in the U.S.-China trade deal becomes known.”

Demand for risky assets is returning ahead of the Christmas holiday period after a choppy year marked by political tensions between Turkey and the United States, a struggling South African economy and fears of a global slowdown, although data from China has signalled the economy is chugging along despite trade tensions.

Almost all country indexes in emerging markets advanced on Tuesday, led by South African equities, which rose for the fifth straight session.

Sentiment was also lifted by oil prices near three-month highs on hopes of increasing oil demand. Russian stocks added as much as 0.5% to hit an all-time high, with energy companies providing the biggest boost.

But with no new developments on trade, currency markets in the developing world were muted against a stronger dollar. A basket of emerging market currencies was largely unchanged, with the Turkish lira and South African rand declining slightly.

The Hungarian forint eased about 0.4% versus the euro ahead of a central bank policy meeting later on Tuesday, where it is expected to keep interest rates unchanged, according to a Reuters poll.

Markets are now awaiting a raft of economic data from the United Kingdom, Europe and the United States, covering jobs, trade balances and industrial and manufacturing production.

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For RUSSIAN market report, see (Reporting by Sagarika Jaisinghani in Bengaluru; editing by Nick Macfie)