File picture: Alex Grimm

London - Emerging stocks traded at fresh three-year highs as markets looked to a European Central Bank meeting later on Thursday for possible monetary stimulus, while Chinese stocks hit 15-month highs.

Russian stocks fell from one-week highs hit following euphoric trading after Ukraine and Russia signalled moves towards peace on Wednesday.

The European Central Bank policy meeting is the first since President Mario Draghi, in a speech at a conference at Jackson Hole last month, ramped up expectations that the bank is ready to embark on a new round of stimulus, underlining concerns about the threat of deflation.

Easy monetary conditions in the developed world have fuelled demand for high-yielding emerging market assets.

The MSCI emerging equities index was steady after ticking up to three-year highs earlier on Thursday, bringing gains for the year to 10 percent.

Chinese stocks hit 15-month highs, having risen 4 percent in the past week, and the yuan hit six-month highs, ahead of August trade data due next week, expected to show an 8 percent rise in exports from a year ago.

Chinese markets have been strengthening in the past few months on a more optimistic outlook for the world's second-largest economy.

Chinese stocks were boosted on Thursday by gains for real estate developers after Reuters reported Beijing is relaxing financing rules for listed property companies.

Russian stocks fell more than half a percent, dropping from one-week highs hit on Wednesday, and the rouble weakened by a third of a percent after the previous session's 1.6 percent rally.

But stocks have held onto the bulk of the 4-5 percent gains made on Wednesday, after President Vladimir Putin unveiled a seven-point peace plan for eastern Ukraine, ahead of this week's NATO summit.

“Markets have been able to get comfortable with whatever happens on the ground as long as there's still positive signals, they are still talking at the higher level,” said Ilan Solot, strategist at Brown Brothers Harriman.

In neighbouring markets, Polish stocks approached the previous day's six-month highs and Hungarian stocks hit two-month highs.

Polish domestic 10-year bond yields were trading at record lows below 3 percent after the central bank said that rate cuts were very likely, after keeping them on hold at a meeting on Wednesday.

“It looks as if they're ramping up their rhetoric and putting their ducks in line to (cut rates) eventually,” said Solot.

The Kazakh tenge strengthened slightly after the central bank said on Wednesday it planned to widen the trading corridor this week.

“This is bullish for investors buying into Kazakh names,” Charles Robertson at Renaissance Capital said in a client note.

In the Middle East, Qatari stocks rose 1 percent to record highs, buoyed in recent weeks by additions of extra Qatari stocks to the MSCI emerging stocks index, following the country's upgrade to emerging market status earlier this year. - Reuters