BENGALURU (Oct 19): Indonesian equities slumped more than 5% to a six-year low on Monday as rattled investors exited stocks after MSCI's latest warning, prompting authorities to unveil steps to tame the swings and set up talks with the index provider.

Malaysia's benchmark stock index slipped nearly 1% to its weakest level in more than a year, following a 0.9% loss in the previous session after data released on Friday showed the economy grew 5.3% in the third quarter, easing from 6% growth in the previous quarter.

Seoul's stock market opened 3.2% lower before reversing course to close up 1.8% on dip buying. 

Singapore stocks inched 0.2% higher and the Philippine benchmark index jumped as much as 0.8% to a three-week high.

Equities in Taipei closed down 0.6%, recovering from a fall to their lowest level since mid-September earlier in the day on concerns over whether lofty artificial intelligence-related valuations can withstand rising financing costs.

Among currencies, the Taiwan dollar posted the biggest decline in the region, falling 0.7% to its weakest level since April last year. The currency has lost about 2% so far this month, its steepest monthly drop since March. 

Taiwan's central bank attributed the recent depreciation to the "turmoil" in global stock markets, with foreign investors net selling domestic stocks and repatriating funds, including dividends. 

The South Korean won appreciated to 1,327.02 per dollar, its strongest level since early October 2024. The Indian rupee extended its winning streak to a sixth session, strengthening to 94.83. 

The Jakarta Composite Index dropped 5.4% to its lowest level since October 2020, extending Friday's nearly 12% plunge in its worst single-day decline in decades. 

In a surprise move on Friday, MSCI said it would place Indonesia on a path to "standalone market" status, a steeper downgrade than the previously flagged "frontier market" classification. 

Such a move would exclude Indonesian stocks from indices tracked by global funds and could trigger billions of dollars in capital outflows.

The stock market operator halved the daily down limit on stock prices, an attempt to put the brakes on the market's heaviest-ever selloff. Officials will also meet the global index provider later in the day to seek clarifications, chief executive Jeffrey Hendrik said.

Ahead of Bank Indonesia's policy meeting later this week, the rupiah weakened to 18,040 per dollar. Further depreciation could force policymakers to raise interest rates.

The Indonesian central bank is likely to raise its policy rate by 25 basis points to 6% following the recent depreciation in the rupiah, said Si Ying Toh, an Asia economist at Nomura. 

The Bank of Korea and the Philippines' central bank are also scheduled to meet in the second half of this week, with the former anticipated to hold steady and the latter to tighten policy settings further.     

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