LONDON, Dec 27 (Reuters) - The Russian rouble firmed 0.3 percent to touch two-month highs on Wednesday, benefiting from oil prices at 2-1/2 year highs and leading most emerging currencies higher against a lacklustre dollar.
Chinese mainland markets were the exception, with the yuan weakening slightly and stocks suffering their worst day in two weeks after data showed earnings at big companies grew at the slowest pace in seven months in November .
Asian tech shares mostly shrugged off the previous day's weak close on Wall Street. This along with firm commodity prices allowed MSCI's main emerging markets index to rally a quarter percent to a near one-month high.
The rouble rose 0.3 percent for a sixth straight day of gains, shrugging off fears of more Western sanctions and opposition calls for boycotting 2018 presidential elections after leader Alexei Navalny was barred from contesting.
But the rouble could firm further if the fear of sanctions persuades Russian businesses to repatriate cash held abroad. President Vladimir Putin has suggested such repatriations could be absolved of profit tax and also allowed to invest in special bonds.
Russian local debt yields - currently near two-month lows - could also fall if the Treasury cuts planned issuance in favour of hard currency debt.
Chris Weafer of Macro-Advisory, a consultancy, predicted "a much more energetic and news-filled six-month period, starting in early February until late July" for Russia.
VTB Capital's Maxim Korovin noted net long rouble positions according to the latest CFTC report, were at the highest levels of 2017.
Also in eastern Europe, the Polish zloty too shrugged off worsening ties with the European Union to touch six-month highs against the euro while the Hungarian forint was at one-month highs, possibly as millions of citizens working overseas came home for Christmas.
The Turkish lira and South African rand also firmed 0.3 percent against the dollar .
Saudi stocks rose half a percent, on hopes that higher oil prices would allow the government to lift spending next year .
For GRAPHIC on emerging market FX performance 2017, see http://tmsnrt.rs/2e7eoml For GRAPHIC on MSCI emerging index performance 2017, see http://tmsnrt.rs/2dZbdP5
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see) (Reporting by Sujata Rao; Editing by Matthew Mpoke Bigg)