March 15 Reuters Emerging market stocks started what promises to be an actionpacked week on the back foot on Monday, while currencies were helped by narrowing gains in the dollar, with rising oil prices lifting the Russian rouble and Mexicos peso.

After posting their best week in a month on Friday, MSCIs index of EM stocks fell half a percent as Chinas bluechip index dropped 2.2 amid concerns of tighter policy while U.S. Treasury yields holding near recent highs added to the pressure.

A higher open for Western European bourses lent some support, with indexes in Poland and Turkey up 0.4 and 0.2 respectively, while Russias MOEX hit a record high.

Bond yields direction remains key, strategists at JPMorgan said in a note.

We do not believe the up move in yields is exhausted. Yes, in the short term policymakers will keep pushing back, but are likely to accept higher yields down the line, as the U.S economy strengthens. The gaps between bond yields versus activity and inflation expectations remain wide.

Eyes this week will be on the highlevel talks between Washington and Beijing, the U.S. Federal Reserves policy decision due Wednesday, central bank meetings in some emerging markets including Turkey, Brazil and Russia with the former two facing headwinds from inflation expected to deliver a hike.

Economic data prints such as U.S. retail sales and housing starts, industrial output from Russia, and inflation in India and Poland are among other factors on investors radar….