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Thai shares set for weakest session since June 27

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Broader Asia stock indexes slip

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Investors await MAS policy decision next week

(Updates for afternoon trade)

By Rishav Chatterjee

Oct 10 (Reuters) - Thai stocks headed for their steepest

decline since late June on Friday, hammered by a sharp sell-off

in Delta Electronics, while shares in other emerging Asia

markets softened as investors locked in profits after an

artificial intelligence-driven rally.

Bangkok's benchmark index slumped as much as 2.3%,

on track for its worst session since June 27.

The drop was largely driven by Delta Electronics,

which plunged after the exchange placed the stock under

surveillance following a 22% surge this month, spurred by its

perceived position as a key AI beneficiary.

The MSCI index of emerging Asian equities

slipped 0.4%, paring gains from the previous session. The MSCI

Asia-Pacific ex-Japan index dipped 0.3%.

Markets in Malaysia and Indonesia fell 0.3%

and 0.1%, respectively, while the Philippines edged 0.3%

lower.

On the other hand, currency markets were choppy against the

U.S. dollar, which was pinned near a two-month high.

The Thai baht weakened, while the Malaysian ringgit

and Indonesian rupiah declined 0.2% each. In

contrast, the Philippine peso firmed 0.2%, and the

Singapore dollar inched up.

Equity markets are experiencing some profit-taking following

recent strong gains, said Massimiliano Bondurri, founder and CEO

of SGMC Capital.

The U.S. dollar continues to strengthen against most

currencies - driven largely by expectations that a potential

government shutdown may result in spending cuts, further

boosting the greenback, Bondurri said.

Asian equity markets have enjoyed a strong run in recent

weeks, thanks to the wave of AI-driven investor enthusiasm that

seemed to brush aside concerns around the U.S. shutdown and a

lack of fresh economic data.

South Korean stocks resumed trading after a long holiday,

with investors moving quickly to ride the AI wave. The benchmark

surged 1.7% to a new record, powered by gains in chipmakers.

Indonesian equities looked set to notch their fourth

straight weekly gain, supported by robust domestic bond demand

and Bank Indonesia's surprise rate cut this month.

Elsewhere, Singapore's market took a breather, with the

benchmark index slipping 0.2%. Still, the city-state has emerged

as one of Southeast Asia's top performers this year, with shares

up more than 17%, bolstered by strength in large-cap financials.

Looking ahead, investors are eyeing the Monetary Authority

of Singapore's (MAS) policy decision next week for further cues.

"Singapore's stellar performance has been propelled

primarily by large caps," said Manishi Raychaudhuri, CEO at

Emmer Capital Partners who publishes on SmartKarma, in a

research note.

We believe it's time for investors to shift their focus to

small- and mid-cap names, as the MAS's S$5 billion ($3.85

billion) Equity Market Development Program initiative encourages

fund managers to look beyond index stocks, he added.

In other news,

Peru's lawmakers swore in Congress chief Jose Jeri

as the country's new president less than an hour after

unanimously voting to remove President Dina Boluarte.

HIGHLIGHTS:

** Powerful 7.5 magnitude earthquake strikes off southern

Philippines

Asia stock indexes

and currencies at

0702 GMT

Japan +0.30 +3.00

-1.01 22.34

China India +0.10 -3.47 0.43 6.96

Indonesi -0.12 -2.84 -0.06 16.47

a

Malaysia -0.24 +5.78 -0.25 -1.02

Philippi +0.12 -0.39 -0.32 -7.52

nes

S.Korea Singapor +0.08 +5.19 -0.23 16.97

e

Taiwan +7.32 18.52

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Thailand -0.12 +4.64 -2.32 -8.33