EMERGING MARKETS-Asia stocks rally as inflation fears ebb; focus on Ukraine talks

* Yields on Indonesian benchmark bonds fall 19 bps * Taiwan shares up more than 2% * Fall in oil prices boosts risk sentiment By Riya Sharma March 10 (Reuters) - Most emerging Asian markets climbed on Thursday, as a sharp plunge in oil prices overnight allayed concerns over a spike in inflation, while investors gauged developments in the Ukraine crisis. Equity markets in Taiwan and China jumped more than 2% each, while shares in the Philippines added over 1%, after oil prices dropped the most since the early pandemic days late on Wednesday. "The easing of inflationary concerns with oil prices plunging sparked the surge in positive market sentiment, while a spike in U.S. Treasury yields brought back investor appetite for riskier assets like the Indonesian bonds," said Khoon Goh, head of Asia research at ANZ Banking Group. Yields on high-returning Indonesian benchmark bonds , up 2.6% this week as of Wednesday, eased 19 basis points to 6.778%. In India, shares surged more than 2% to a one-week high and the rupee climbed 0.6%, while investors focused on election results in the key state of Uttar Pradesh where Prime Minister Narendra Modi's party was set to retain control. Politics also dominated headlines in South Korea, where Conservative opposition candidate Yoon Suk-yeol won a tight presidential election. The nation's stocks surged 2.2% as markets opened after a holiday, and the won firmed 0.7%. Currencies in the region's major energy exporters Indonesia and Malaysia also inched up, while stocks in Jakarta and Kuala Lumpur added 0.2% and 1%, respectively. "Lower energy prices should be negative for currencies in Indonesia and Malaysia, but that's being offset by the rally in risk assets which have contributed towards a positive investor sentiment today, limiting declines in these currencies," said Goh. Markets also awaited a meeting between foreign ministers of Russia and Ukraine, hoping for a de-escalation of military tensions between the countries. The conflict has stoked fears of a stunted global recovery and aggressive central bank policy tightening to tackle inflation. "The market may have gotten past the worst of conflict fears ... the focus lies with inflation, which is proving to be persistent, rather than transitory," market strategists at DBS said in a note. The latest U.S. inflation report is due on Thursday. HIGHLIGHTS: ** Top gainers on the Jakarta stock index include Perdana Bangun Pusaka Tbk PT, up 24.88%, and Matahari Putra Prima Tbk PT, up 16.67% ** Top gainers on FTSE Bursa Malaysia Kl Index include Inari Amertron Bhd, up 6.57%, and Digi.Com Bhd , up 3.88% Asia stock indexes and currencies at 0634 GMT COUNTRY FX RIC FX FX INDE STOCKS STOCKS DAILY % YTD % X DAILY YTD % % Japan -0.18 -0.82 <.N2 3.94 -10.77 25> China EC> India +0.62 -2.31 <.NS 2.26 -3.68 EI> Indonesi +0.38 -0.28 <.JK 0.07 4.38 a SE> Malaysia +0.02 -0.48 <.KL 1.04 2.67 SE> Philippi -0.44 -2.34 <.PS 1.21 -0.68 nes I> S.Korea 11> Singapor +0.10 -0.55 <.ST 1.16 3.48 e I> Taiwan +0.28 -2.40 <.TW 2.46 -4.31 II> Thailand -0.09 +1.00 <.SE 0.67 -0.18 TI> (Reporting by Riya Sharma; Editing by Vinay Dwivedi)