* MSCI EM shares index down ~1.8% this week * South African rand hits two-month low * Turkish lira up for the week * FTSE Russell’s WGBI China govt bond inclusion takes effect Oct 29 (Reuters) - Emerging market stocks fell for a fourth straight session on Friday and were headed for their biggest weekly drop in six, as investor sentiment soured after weak results from Amazon and Apple. EM currencies, however, looked set for a third consecutive weekly gain as the dollar made lacklustre move ahead of the U.S. Federal Reserve policy meeting next week. Turkey’s lira extended losses after inflation targets were raised, but was set to end the week higher, breaking a three-week losing run. A relief rally early in the week as President Tayyip Erdogan backed down from escalating diplomatic tensions with the West, helped the currency. South Africa’s rand slumped 0.8% to a two-month low as severe power outages at state utility Eskom as well as uncertainty ahead of municipal elections on Monday weighed. The currency is down around 2.8% for the week, its worst in six weeks. EM bourses fell as disappointing results from two of the FAANG stocks fed fears about supply chain woes hitting global growth momentum. Apple and Amazon suppliers, especially in South Korea and Taiwan, fell. MSCI’s index of EM shares slipped 0.5%, down about 12% from all-time highs hit in February. It is set to end the week down about 1.8%. “It is no coincidence that markets heavy with Apple suppliers are falling the most,” said Jeffrey Halley, senior market analyst, Asia Pacific at OANDA. But “the fallout from the Apple and Amazon results has been relatively muted in the bigger picture. Supply change blockages and shortages also appear to be being accepted as a fact of life by markets,” he said. Capping losses were mainland China stocks , up more than 0.8% after three straight sessions of losses, as technology, consumer and industrial stocks firmed. Indebted developer China Evergrande Group slipped 3.7% even after it made a payment ahead of deadline, while Chinese Estates Holdings warned of an aggregate loss of HK$1.36 billion ($174.2 million) in the current fiscal year from the sale of all its bonds issued by peer Kaisa Group Holdings. Kaisa shares rose on plans to sell the property management unit, as the developer scrambles to meet a wall of debt repayments. Meanwhile, FTSE Russell’s World Government Bond Index (WGBI) will include Chinese government bonds (CGBs) from Friday, marking a milestone in foreign participation in the world’s second-largest bond market. It is the last major global index to add the bonds. Elsewhere, Turkish and Polish shares rose, while those in South Africa, Russia and Hungary fell between 0.1% and 0.6%. 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 Susan Mathew in Bengaluru; Editing by Subhranshu Sahu