Lira hits record low of 17.6 a dollar China rate cut little help for stocks Chilean assets eyed after Boric"s election win Dec 20 (Reuters) - Renewed concerns over the fast-spreading Omicron variant sent a closely watched index of emerging market stocks to fresh one-year lows on Monday, with Chinese equities finding little support from an interest rate cut and the Turkish lira plunging to a new record low. The overall mood was glum across global markets, with investors selling equities, emerging market currencies and commodities as the spread of Omicron saw the Netherlands go into lockdown on Sunday while other countries weighed similar steps. read more The lira stood out among its EM peers again with a 6% plunge to a record low of 17.6 per dollar following President Tayyip Erdogan"s fresh pledge to keep interest rates low, citing Islamic usury doctrine. read more The president"s push for 500 basis points of interest rate cuts since September has set off Turkey"s worst currency crisis in two decades, with the lira crashing 35% in the last 30 days despite $6 billion in central bank interventions this month. "We expect interventions to continue going forward, although given the concerns regarding the inadequacy of reserves, interventions are unlikely to be sizeable and, thus, unlikely to stabilise the currency," Gokce Celik, senior economist at Unicredit, wrote in a note. "The sharp currency depreciation and elevated volatility in markets might already be risking a tightening of financial conditions by pushing market rates higher." Turkey"s main blue-chip stock index (.XU100) regained some composure, up about a percent after a sharp Friday selloff that triggered circuit breakers which temporarily halted trading. The wider MSCI EM stocks index (.MSCI) fell 2% to sink to its lowest since November 2020. Shanghai stocks (.SSE)(.CSI300) closed more than a percent lower despite a cut to the lending benchmark loan prime rate (LP) for the first time in 20 months to prop up the slowing economy. read more India"s NS Nifty 50 index (.INES) fell 2.4%, on track to close 10% below its record high hit in October. All eyes were on Chilean markets after leftist Gabriel Boric won a presidential runoff election on Sunday, in the most polarised election since the country"s return to democracy in 1990. read more Boric has pledged to overhaul Chile"s market-orientated economic model and said that he would look to create a state lithium firm and criticised privatisation of the sector, where Albemarle (ALB.N) and SUM are currently the main two players. IShares MSCI Chile ETF fell more than 6% in thin U.S. premarket trading, while SQM"s U.S.-listed shares dropped 7%. The Chilean peso has shed nearly 16% versus the dollar this year. "Once the dust settles, a buying opportunity might emerge in Chile. Political volatility will be contained and congress will push back on extreme policies," analysts at BC Research said in a note. Adding to woes, Fitch Ratings over the weekend downgraded Sri Lanka"s sovereign rating to "CC" from "CC", citing a growing risk of debt default in 2022. Sri Lanka faces foreign currency debt service payments of $6.9 billion in 2022. read more For GRAPHIC on emerging market FX performance in 2021, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2021, see https://tmsnrt.rs/2OusNdX For TOP NEWS across emerging markets For CENTRAL EUROPE market report, see CEDE/ For TURKISH market report, see For RUSSIAN market report, see Reporting by Sruthi Shankar in Bengaluru; editing by Jason Neely