KONTAN.CO.ID - TOKYO. Taiwan equities booked their worst week since 2001 and South Korean shares slumped on Friday, as investors dumped chipmakers, accelerating a technology selloff driven by concerns over stricter regulation and fading AI optimism.

Financial markets across the world have seesawed this week as hopes that a Democratic sweep in US elections would hasten an end to the Iran war shrivelled in the face of mounting concern over tighter regulation of data centres.

The global tech selloff caused the Nasdaq's steepest one-day drop since April's "Liberation Day" rout, with fears of greater scrutiny of AI investments and data-centre projects spilling over into tech-heavy markets across emerging Asia.

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MSCI's emerging markets index fell 4.7% to its lowest since early April, dragged down by sharp declines in technology stocks across north Asia.

"There is a clear element of panic in the selling, with crowded positioning, deleveraging and potentially forced liquidations amplifying the decline," said Dilin Wu, research strategist at Pepperstone.

Taiwan stocks fell 4.5% to their lowest close since late April and posted the steepest weekly drop since September 2001. The market has slumped more than 20% from its early-October record high.

South Korea's KOSPI reeled from the technology-led selloff, plunging as much as 8.8% and triggering a circuit breaker before recovering some ground to close 6% lower. The benchmark lost more than a tenth of its value this week.

"What concerns me is that the underlying pressure hasn't really gone away," Wu said.

"Foreign investors have been heavy sellers in Taiwan, and the broader unwind in global AI positioning may not be over yet."

Indonesia's rupiah remained within striking distance of the record low touched in June, while stocks fell 2% with investors remaining cautious after MSCI earlier warned Indonesia could risk losing its emerging-market status over concerns about market accessibility and transparency.

Focus now shifts to the global index provider's November index review next week, which could offer fresh clues on Indonesia's standing in the benchmark provider's indexes.

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In Singapore, stocks slid 2.8%, dragged lower by heavyweight lenders DBS and United Overseas Bank, which fell 2.5% and 3.2%, respectively.

The benchmark has lost more than 4% this week, weighed down by a sharp selloff in banks after the lenders reported weaker-than-expected profits.

In Malaysia, stocks fell 1.4% and the ringgit weakened to 4.056 per US dollar. Bank Negara Malaysia left interest rates unchanged as expected on Thursday, citing moderate inflation and an economy it expects to remain resilient next year.