*

EM stocks down 0.14%, FX flat

*

All eyes on Nvidia's ( NVDA ) earnings after Wednesday market close

*

Hungary's central bank keeps base rate steady at 6.5%

*

Russia carries out overnight attack on Ukraine, Kyiv bonds

mixed

By Nikhil Sharma

Nov 19 (Reuters) - Emerging market assets were subdued

on Wednesday as investors turned cautious ahead of Nvidia's ( NVDA )

quarterly earnings, which could shape the future of the

AI-driven market rally, while Hungary extended the pause on its

benchmark interest rate.

A broader gauge of emerging market stocks slipped

0.14%, after dropping about 1.9% in the previous session - its

worst day since April 7 - on mounting concerns over the

valuations of tech and AI-related stocks and the spending

pouring into the sector.

At the heart of the AI mania is Nvidia ( NVDA ), the world's

most valuable chipmaker, which faces a high bar for earnings

since even mild underperformance could trigger significant

volatility. The stock was up 0.4% in premarket trading ahead of

results scheduled for release after Wednesday's market close.

MSCI's index for EM currencies was flat

after modest losses in the previous session.

"Many investors see those earnings as a major test for the

AI trade that has been so popular. So definitely those earnings

will set the tone for the markets," said Piotr Matys, senior FX

analyst at In Touch Capital Markets.

In Central-Eastern Europe, Hungary's central bank left its

base rate steady at the European Union's joint-highest level of

6.5% on Tuesday, noting fiscal loosening and an uncertain

inflation outlook after next year's parliamentary election.

"The central bank commented on expansionary fiscal policy,

which is a major factor for the central bank to maintain tight

monetary policy. So essentially the overall message from the

central bank was hawkish," In Touch Capital Markets' Piotr

added.

Last week, the government raised its budget deficit targets

to 5% for this year and next to support higher pre-election

spending, which the bank said would make cutting the public

debt-to-GDP ratio harder.

The Hungarian forint, which fell last week after

the deficit target hike, was down 0.4% on Wednesday after two

straight days of gains. However, the currency has had a strong

run in 2025, advancing 6.7% year-to-date, supported by a higher

interest rate differential that has bolstered carry inflows.

Budapest stocks rose 0.33%, taking its year-to-date

gains to 34.1%. This stellar run has also been observed in

broader emerging markets, reflecting investors' shift to markets

that are seen as undervalued, and offer cheaper valuations and

higher yields.

The Czech koruna was flat, while Prague's main

stock index added 0.1% after steep losses in the previous

two sessions. The country's central bank on Tuesday acknowledged

that monetary conditions were slightly restrictive, providing

room to react to risks in either direction.

The Polish zloty slipped 0.16%, while Warsaw's

benchmark index added 0.1% after four days of declines.

The bank left rates unchanged for the fourth successive

meeting earlier this month, citing inflation risks from wage

growth and potential government spending with the arrival of a

new government led by protectionist prime minister hopeful

Andrej Babis.

Elsewhere, geopolitical tensions escalated after Ukraine

said 10 people were killed in a heavy overnight Russian missile

and drone attack that struck a residential tower block in the

western Ukrainian city of Ternopil.

Ukraine's international bonds were mixed. The country is

also in political turmoil over a corruption scandal, with one of

its main opposition parties physically blocking lawmakers in

parliament from voting to dismiss two ministers under

investigation.

For TOP NEWS across emerging markets

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see