Emerging stocks submerged, UK gears up for 'Super Thursday'

Emerging market stocks slipped to their lowest in over two years on Thursday as nervousness about an end to record low U.S. and global interest rates and continued weakness in commodity markets took their toll.

Many investors were keeping their moves small ahead of crucial U.S. jobs data on Friday but there was plenty going on to distract them while waiting. The Swiss franc fell to its lowest in five months against the euro, as investors sensed that its central bank may have to ease policy, while UK markets were gearing up for what has been dubbed 'Super Thursday' at the Bank of England.

For the first time in its history, the British central bank will simultaneously publish its interest rate decision, the breakdown of how policymakers voted and a summary of their debate, and its quarterly forecasts for Britain's economy, including inflation.

The release is due at 1100 GMT (0700 EDT). Despite inflation sitting at zero, at least two of the Bank's nine rate-setters are expected to have decided that it is time to start weaning the economy off crisis-era low rates after two years of strong growth. "The first reaction will most likely be on the number of dissenting votes, if any, and later on the new economic forecasts," said Marshall Gittler, head of global FX strategy at IronFX Global.

London's FTSE .FTSE was the weakest performer of Europe's major stocks markets <0#.INDEXE>.FTEU3, which saw a largely subdued start to the day.

The pan-European FTSEurofirst 300 index .FTEU3, which rose 1.3 percent in the previous session, fell back 0.4 percent as weak oil prices also weighed on energy stocks. But amid commodities weakness and the ongoing uncertainty about the tim- ing and impact of the first U.S. rate hike in almost a decade, it was emerging markets that remained the biggest concern.

MSCI's benchmark emerging markets index .MSCIEF hit its lowest level since mid-2013 as fresh losses in China, large parts of Asia and Russia once again weighed.

The pressure continued to crank up on Malaysia. The ringgit hit a fresh 17-year low and some local bond prices fell, in a sign of declining confidence among foreign investors in the face of political uncertainty and low commodity prices.

"If weakening pressure on MYR persists, we can definitely not exclude the possibility of FX outflow restriction," said Amy Yuan Zhuang, a senior analyst at Nordea in Singapore.

Saudi Arabia's stock market fell as Brent oil traded below $50 a barrel, once again depressing investor sentiment across the Gulf region.