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By Sruthi Narasimha Chari

May 25 (Reuters) - Emerging market equities and currencies in Asia rose on Monday as hopes of a potential deal to resolve the Iran conflict pressured the dollar and oil prices, although uncertainty over the reopening of the Strait of Hormuz limited broader gains.

The MSCI gauge of EM Asia equities .MIMS00000PUS advanced 1.5% to its highest level in six sessions, closing in on its record high. An index of EM currencies .MIEM00000CUS also edged up to its highest in just over a week.

Energy prices have soared sharply since the U.S.-Israeli strikes on Iran began nearly three months ago, upending inflation and growth projections for most oil-importing Asian economies.

This has strained developing economies' current accounts, driving significant capital outflows. Narrowing bond yield spread with developed markets have accelerated these outflows, putting pressure on several regional currencies and prompting central banks to intervene.

"While the longer end of the yield curve has risen, Asian policy rates remain low, especially as inflationary pressures are likely to rise," said analysts at Natixis, led by EM Asia Senior Economist Trinh Nguyen.

"The Iran war supply shock is turning into an exchange crisis, and EM Asian central banks must contend with the fallout of investors' risk appetite that has widened the wedge between winners and losers."

Across Asia, regional currencies appreciated to levels last seen in mid-May. The Indian rupee INR=IN, Thai baht THB=TH, the Malaysian ringgit MYR=, the Philippine peso PHP= and Singapore's dollar SGD= all gained ground.

In contrast, the Indonesian rupiah IDR= weakened toward historic lows on concerns over capital outflow, governance issues and export controls.

Equities markets also posted strong gains. Indian benchmarks Nifty 50 .NSEI and the BSE Sensex .BSESN rose more than 1% each, Taiwan stocks .TWII advanced more than 3% and Philippine equities climbed over 1%.

Shares in Singapore .STI gained 0.5% to scale a record high of 5,102.07 points, but were trading largely flat in the afternoon, while Jakarta stocks .JKSE rebounded modestly after steep losses over the previous two weeks.

However, U.S. President Donald Trump's instruction to his team to not rush negotiations with Iran kept risk sentiment in check.

"Ultimately, markets will need to see the Strait of Hormuz reopened for positive sentiment to be sustained," said MUFG senior currency analyst Lloyd Chan, pointing to the need for a follow-through of a peace deal between the U.S. and Iran, including normalising Hormuz transit.

HIGHLIGHTS:

** Yield on Indonesia's 10-year bonds ID10YT=RR at 6.737%

** Singapore economy beats expectations in Q1 with 6% annual growth

** Malaysia says energy supplies are secured until end-July

** Global tensions set to stalk Singapore's flagship defence summit

** Chandra Asri Pacific TPIA.JK tumbles 11.3%, Dian Swastatika DSSA.JK down 13%

Asia stock indexes and currencies at 0804 GMT
COUNTRY	FX RIC	FX DAILY %	FX YTD %	INDEX	STOCKS DAILY %	STOCKS YTD %
Japan	JPY=	+0.14	-1.46	.N225	2.87	25.71
China	CNY=CFXS	+0.20	+3.00	.SSEC	0.96	4.63
India	INR=IN	+0.35	-5.75	.NSEI	1.10	-8.23
Indonesia	IDR=	-0.23	-5.98	.JKSE	0.71	-28.23
Malaysia	MYR=	+0.33	+2.63	.KLSE	-0.14	1.80
Philippines	PHP=	+0.24	-4.30	.PSI	0.80	-0.72
S.Korea	KRW=KFTC	-	-5.15	.KS11	-	86.22
Singapore	SGD=	+0.17	+0.64	.STI	0.08	9.16
Taiwan	TWD=TP	+0.31	-0.10	.TWII	3.26	50.69
Thailand	THB=TH	+0.31	-3.23	.SETI	0.75	23.06