* South African rand worst weekly performer, down 2.3% * Markets see Russian central bank hiking rates by 100 bps * Rouble fares slightly better than EMEA peers July 23 (Reuters) - Most emerging market stocks and currencies headed on Friday for weekly losses on fears that a rise in COVID-19 cases could dent an economic recovery, while Russia’s rouble edged lower ahead of a possible interest rate hike. MSCI’s index of emerging market (EM) equities fell 0.6%, and was set to lose about 1.6% this week, as it struggled to recover from a steep selldown earlier in the week. MSCI’s currency index fell 0.1%, and was set to lose 0.4% this week. South Africa’s rand lagged its EM peers with a 0.6% fall. Concerns over renewed violence in the country, as well as dovish comments from the central bank put the rand on course for a 2.3% weekly loss, making it the worst EM performer this week. South African stocks jumped 0.8% on Friday, marking a strong comeback from losses earlier in the week. Russia’s rouble fell 0.3% on Friday, but fared better than most of its peers in Europe, the Middle East, and Africa (EMEA) this week as investors pencilled in a possible 100 basis point interest rate hike by the central bank later in the day. Recent volatility in the rouble, driven by swings in the oil market and a spike in inflation, have primed the central bank to raise rates to 6.5%, putting them at the upper end of EM rates. “Beyond today’s hike, if CBR were to indicate through its statement that further hikes are likely in the coming meetings, that would qualify as a slight hawkish surprise in our view, and support the exchange rate,” Tatha Ghose, FX and EM analyst at Commerzbank, wrote in a note. Most EMEA stocks were flat. Hungarian stocks fell 0.1%, while the forint was muted against the euro as the European Union sought a two-month delay in talks over the country’s pandemic recovery plan. Relief funding is likely to be delayed over contested issues as part of an “ideological war” with Brussels, nationalist Hungarian Prime Minister Viktor Orban said. But weakness in the euro, following dovish comments from the European Central Bank, helped most other central European currencies gain. For GRAPHIC on emerging market FX performance in 2021, see tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2021, see tmsnrt.rs/2OusNdX For TOP NEWS across emerging markets For CENTRAL EUROPE market report, see For TURKISH market report, see For RUSSIAN market report, see Reporting by Ambar Warrick Editing by Mark Heinrich Our Standards: The Thomson Reuters Trust Principles.