EMERGING MARKETS-Asian stocks firm but China worries cap gains, S. Korea shares lead

By Indranil Sarkar Oct 26 (Reuters) - South Korea shares led gains among Asia's emerging stock markets on Tuesday as a strong start to earnings season boosted chipmakers, but the mood was sombre as uncertainties persisted amid property troubles and rising COVID-19 cases in China. Stocks in Indonesia, India and Thailand rose between 0.2% and 0.7%, while Singapore and Philippines shares slipped about 0.2% each. China stepped up curbs in Beijing after reporting an increase in COVID-19 cases from a Delta variant outbreak, with health officials fearing that infections in the world's most populated country were likely to spread further. Shanghai stocks and the yuan were both trading flat. "There have been questions about when China might lift its zero-case COVID strategy," said Alvin Tan, RBC Capital Markets head of Asia FX Strategy, adding that the country was unlikely to shift to a more open policy before the Winter Olympics scheduled for February next year. More movement restrictions could hurt trade with its Asian peers as China is the region's top trade partner, adding to woes stemming from a liquidity crisis at the country's high-yield real estate sector that could have a global impact. Meanwhile, South Korea's KOSPI jumped 0.8% to hit a near one-month high as high-profile chipmakers reported earnings, with world's no.2 memory chipmaker SK Hynix forecasting steady growth in demand for semiconductors. The won firmed 0.3% even as data showed that Asia's fourth-largest economy grew at a slower pace in the third quarter, with robust exports offset by weak domestic demand and construction and facility investments. However, analysts were sure the Bank of Korea would go ahead and raise interest rates at the policy meeting next month. "Admittedly, the risks have shifted marginally to BoK remaining on hold... but the trajectory of uneven gross domestic product growth is not likely a surprise to BoK and indeed to ourselves," Mizuho analysts wrote in a note. Singapore's dollar was largely unchanged, but shares slipped after conglomerate Keppel Corp disclosed on Monday that its unit was facing a lawsuit of about $819 million in the United States. Other Asian currencies were quite mixed against a steady dollar, with the Malaysian ringgit and Taiwan's dollar firming up to 0.2% each, while the Philippine peso slipped. HIGHLIGHTS ** Indonesian 10-year benchmark yields are down 0.5 basis points at 6.164%​​ ** Malaysia's 10-year benchmark yield is down 1.3 basis points at 3.608%​​ ** Top losers on the Singapore STI include Keppel Corporation down 2.19% and SATS Ltd down 1.2% Asia stock indexes and currencies at 0524 GMT COUNTRY FX RIC FX FX INDEX STOCKS STOCKS DAILY YTD DAILY YTD % % % % Japan -0.21 -9.3 1.78 6.07 9 China +0.04 +2.2 0.04 3.98 8 India -0.02 -2.7 0.35 30.09 0 Indonesia -0.09 -0.9 0.57 11.45 0 Malaysia +0.08 -3.0 -0.23 -2.64 4 Philippines -0.11 -5.5 0.56 1.57 4 S.Korea +0.23 -6.8 0.83 6.00 2 Singapore +0.01 -1.9 -0.07 12.51 2 Taiwan +0.15 +2.3 0.71 15.49 4 Thailand -0.06 -9.5 0.07 12.83 4 (Reporting by Indranil Sarkar in Bengaluru; Editing by Lincoln Feast.)