* China says willing to work out trade agreement
* Hong Kong, South Korea shares lead gains
* South Africa's rand firms as central bank holds rates
* Hungary, Poland, Romania currencies firm to the euro
Nov 22 (Reuters) - Emerging market stocks looked set to end the week on a rosy note on Friday as the latest comments from China about finding a resolution to its tariff dispute with the United States lifted hopes that the two sides would reach a trade agreement soon.
An index of stocks in the developing world was up 0.2%, having declined for two sessions on a diplomatic row between the world's top two economies after Washington passed a bill supporting protesters in Hong Kong. Reuters had also reported that the trade deal could slide into 2020.
But on Friday, China said it wanted to work out an initial trade agreement in an attempt to halt a dispute that has hurt its economic growth and dulled global business sentiment, albeit adding that it was not afraid to retaliate when necessary.
"Market expectations (are) that a 'phase one' deal is still a very real possibility," said Teeuwe Mevissen, senior market economist at Rabobank.
"But having said that, it remains to be seen what China's reaction will be to the Senate bill regarding the situation in Hong Kong. That will put negotiations under pressure and make them more complicated."
Shares in trade-sensitive South Korea ended higher on Friday, but still closed the week with their first decline in seven. Hong Kong stocks were up 0.5% after falling in the past two days, while a broad gauge of Asian equities made a slight recovery from three-week lows.
Markets have also looked to major central banks for cues on further monetary policy. In her first major speech as ECB chief, Christine Lagarde did not elaborate on the central bank's plans, but said it would continue to do its part to support the economy.
South Africa's rand firmed again on Friday, a day after the country's central bank kept its repo rate unchanged.
The Turkish lira and Russian rouble were steady against the dollar.
Currencies in central and eastern European economies including Hungary, Poland, the Czech Republic and Romania were slightly firmer versus the euro.
Russian stocks rose nearly half a percent, supported by gains for Gazprom after a report that the oil giant was selling 3.6% of its shares to one buyer.
For GRAPHIC on emerging market FX performance 2019, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance 2019, see https://tmsnrt.rs/2OusNdX
For TOP NEWS across emerging markets
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see (Reporting by Shreyashi Sanyal and Sagarika Jaisinghani in Bengaluru)