* EM stocks rise 0.9%, currencies fall 0.2%

* Israel's shekel flat against the dollar

* National Bank of Poland expected to hold rates

By Niket Nishant

June 2 (Reuters) - Emerging market stocks rose on

Tuesday, boosted by hopes of some easing in Middle East tensions

that allowed investors to double down on artificial intelligence

bets.

The MSCI index of EM stocks climbed 0.9%, hovering

near record highs and on track for its third consecutive session

in positive territory. An MSCI gauge of EM currencies

slipped 0.2%.

Lebanon announced a partial ceasefire between Hezbollah and

Israel on Monday, in what would amount to a limited

de-escalation of a conflict that has complicated efforts to

secure a peace agreement between Washington and Tehran.

"The latest ceasefire news seems to be clear evidence that

the appetite for taking the conflict to the next stage of

complete regime change has waned," said Richard de Chazal, macro

analyst at William Blair.

Hopes for a diplomatic resolution to the war persist despite

several setbacks, with global equity market sentiment tuned in

closelyto Middle East developments.

Israel's shekel was flat against the U.S. dollar,

trading near highs not seen in more than three decades.

ZLOTY HOLDS STEADY AHEAD OF RATE DECISION

The Polish zloty was flat against the euro ahead

of an interest rate decision from the National Bank of Poland,

while equities rose 1.4%.

Policymakers are widely expected to keep interest rates

unchanged later on Tuesday. Inflation in May was more benign

than expected, according to data released last week, potentially

buying time for the NBP to assess economic conditions before it

acts.

"We continue to expect policy rates to remain on hold this

year and in 2027. At the same time, the risk of monetary

tightening this year has diminished," said Adam Antoniak, senior

economist for Poland at ING.

Hungary's stock benchmark rose 1%. Data showed that

itseconomy grew 1.7% in the first quarter, compared to a year

ago, in line with the estimate.

The South African rand rose 0.6% against the dollar

as gold prices gained. The country is a major exporter of gold.

Senegal's dollar-denominated bonds were down, with issues

maturing in 2031 and 2033 down 0.5 cents and 0.2 cents,

respectively.

Recently ousted prime minister, Ousmane Sonko, said on

Monday that the political party he leads will not participate in

the country's new government, raising the prospect of political

gridlock amid a daunting debt crisis.

AI FAVOURITES IN ASIA GAIN GROUND

South Korea's tech-heavy KOSPI index rose 0.2%,

helped by gains in shares of Samsung Electronics ( SSNLF ) and

LG Electronics. Taiwanese equities rose

0.5%.

Elsewhere in Asia, limited exposure to AI-linked stocks,

heavy selling by foreign investors and weak earnings growth

pushed India's equity markets down to the seventh place in terms

of market capitalisation.

The Nifty 50 index rose 0.3% on Tuesday -- still

down more than 10% in 2026.