EMERGING MARKETS-Hover at highs; East Europe FX rebound

* Emerging markets rise on commodities, Q3 earnings hopes

* Russian rouble highest since January

* Eastern European currencies rebound, Turkish lira eases

By Sebastian Tong

LONDON, Oct 12 (Reuters) - Emerging assets were firmer on Monday, hovering at more-than-one-year highs, buoyed by optimism over third-quarter earnings and robust commodity prices.

Russia's rouble hit its highest since January against its euro-dollar basket even as most Eastern European currencies rebounded from previous week lows.

Overnight losses in Asian markets including China and South Korea kept the key equity index <.MSCIEF> flat, staying just off the 13-month high it reached on Friday but emerging sovereign debt spreads <11EMJ> tightened 1 basis point to trade at levels last seen 14 months ago.

Monday's U.S. and Japanese market holidays lent trading a subdued tone but risk appetite was otherwise bolstered by hopes that the start of the corporate results reporting season would confirm the quickening pace of global recovery.

"The third-quarter earnings season has come into play but you won't see the big surprises that we had in the second quarter. In fact, we could see some disappointment that could trigger some profit-taking over the coming weeks," said Simon Quijano-Evans, emerging Europe economist and strategist at Cheuvreux.

The commodities-focused bourses of South Africa <.JTOPI> and Russia saw healthy gains with gold staying aloft at record levels while oil climbing above $73 a barrel.

Russian shares <.IRTS><.MCX> powered up nearly 3 percent to 13-month highs while the rouble firmed to its highest level versus its euro-dollar basket since mid-January, following six consecutive weeks of gains. While the central bank has been seen buying dollars to slow the rouble's appreciation, traders say the new intervention level is located at 35.80 to the basket, compared to 35.85 previously. [ID:nLC356999]

REBOUND

After their recent bout of weakness, most Eastern European currencies rebounded, helped in part by buoyant regional bourses which saw Polish <.WIG20>, Czech <.PX> and Hungarian <.BUX> stocks rising to two-week highs. The Czech crown was up versus euro for the first time in nearly two weeks, after data showing a smaller-than-expected current account gap tempered expectations that the central bank would lower interest rates further from their all-time low. [ID:nLC679110]

Helping to support sentiment in the region was the more conciliatory note sounded by Latvian Prime Minister Valdis Dombrovskis towards its international lenders who last week criticised the Baltic state for backtracking on budget targets.

Dombrovskis said on Monday his government was moving towards fulfilling the conditions of its loan deal, and was carrying out sufficient fiscal consolidation measures to satisfy international lenders. [ID:nDKT004664]

Expectations that Turkey's central bank will cut its benchmark borrowing rate by 50 basis points at its policy meeting this Thursday weighed on the lira but helped drive the country's key equity index <.XU100> to its highest level since January 2008. [ID:nLC624301]

Sentiment remains supported by hopes that Ankara will soon reach a loan accord with the International Monetary Fund. (Reporting by Sebastian Tong; Editing by Toby Chopra)