* Taiwan stocks log worst week since early April 2025

* South Korean markets closed, down 9% over the week

* Malaysia's economy grew 5.8% in Q2 - advance estimate

* Rupiah appreciates to two-week high of 17,935 per dollar

(Updates for afternoon trade)

By Sherin Sunny

July 17 (Reuters) - Asian shares fell for a second

consecutive session on Friday, with Taiwan bearing the brunt of

a chip-stock selloff, as investors reassessed the durability of

the AI-driven global rally.

TSMC, the world's top contract chipmaker and a key

Nvidia ( NVDA ) and Apple ( AAPL ) supplier, shed more than 7%

to end at a five-week low despite reporting record quarterly

profit on Thursday. The stock marked its worst week since early

March.

Taiwan's semiconductor-heavy benchmark posted its

worst week since early April 2025, falling more than 6% on the

day to its lowest close in nearly two months.

Investors are taking another step towards scrutinising

chipmakers' ability to monetise, said Glenn Yin, director of

research at ACCM, adding that despite TSMC's record quarterly

profit, investors are focused on higher capital expenditure and

overseas expansion costs.

The MSCI EM Asia equities index slumped as

much as 3.3%. Taiwanese stocks make up one-third of the index.

"Taiwan is one of the cleanest liquid proxies for AI chip

demand. When positioning is crowded, even a strong result can

trigger profit-taking if the upside surprise is not enough,"

said Billy Leung, investment strategist at Global X ETFs

Australia.

The chip-heavy South Korean benchmark KOSPI ended

the week nearly 9% in the red, rounding off a turbulent week of

sharp swings in memory chipmakers, the first rate hike in over

three years, and regulatory intervention in single-stock

leveraged funds that are behind much of the upheaval.

The market was closed on Friday.

Volatility in chipmakers could ease on greater signs about

hyperscaler AI capex remaining durable and higher foundry

spending translating into sustained earnings growth, said Leung.

In Singapore, equities fell as much as 0.8% to extend

declines from the previous session, while the currency

was steady at 1.2899 a dollar.

In Malaysia, stocks were up 0.8% while the ringgit

weakened marginally to 4.081 per U.S. dollar, its lowest

since early July. Data showed that Malaysia's economy grew 5.8%

in the second quarter from a year earlier.

Shares in the Philippines advanced as much as 1.4%,

their highest since early March, while those in Jakarta

gained as much as 1%, logging their seventh straight session of

gains.

Both the Thai baht and the Taiwan dollar

weakened to their lowest since late April 2025. The rupiah

extended gains into a fourth day, firming to 17,935 a

dollar for the first time in two weeks.

HIGHLIGHTS:

** Japan's Nikkei slides into correction zone on tech selloff,

Middle East conflict

** Japan June core inflation seen at 1.6% on elevated energy

prices, Reuters poll shows

** CXMT's $8.6 billion Shanghai IPO draws less frenzied demand

amid China tech selloff

Asia stock indexes and currencies at 0754 GMT

COUNTRY FX RIC FX FX YTD INDEX STOCKS STOCKS

DAILY % DAILY YTD %

% %

Japan +0.09 -3.45 -4.03 23.75

China India +0.00 -6.72 0.86 -7.08

Indonesia +0.53 -6.79 0.57 -28.96

Malaysia -0.25 -0.59 0.78 3.30

Philippines +0.07 -4.51 1.13 5.68

S.Korea Singapore -0.01 -0.33 -0.60 18.50

Taiwan -0.25 -2.76 -4.18 50.94

Thailand -0.04 -6.34 0.17 30.04

(Reporting by Sherin Sunny in Bengaluru; Editing by

Harikrishnan Nair and Mrigank Dhaniwala)