May 20 (Reuters) - Foreign selling in Asian equities has

accelerated so far in May as investors turn cautious over the

impact of war-driven inflation and higher borrowing costs on

corporate margins across the region.

Foreign investors have so far sold a net $24.75 billion of

regional equities this month, with a record $17.27 billion of

shares divested in the last week, LSEG data covering exchanges

in South Korea, Taiwan, Thailand, India, Indonesia, Vietnam and

the Philippines showed.

The 30-year U.S. Treasury yield climbed to its

highest level since 2007 this week, adding pressure on Asian

equities as higher long-term borrowing costs weighed on

valuations, particularly in growth-heavy markets.

"Higher yields could increase pressure on equities as

tighter financial conditions could weigh on valuations,

particularly in growth sectors," said Paolo Broccardo, CEO at

BankPro, in a note.

South Korean stocks faced a record $13.14 billion worth of

foreign outflows in the last week. Last week, investors also

divested $2.88 billion of local shares in Taiwan, $1.35 billion

in India and $184 million in Indonesia.

"Mainland China H-share, Hong Kong, Korea and Taiwan

equities are traditionally most sensitive to an increase in

yields," said Herald van der Linde, head of equity strategy for

Asia Pacific at HSBC.

"30% of Asian funds' exposure is to a handful of stocks in

Korea and Taiwan. Any de-risking may cause more volatility in

these markets," HSBC's Linde said.

Indonesian and Thai stocks have, however, still attracted

$511 million and $215 million of foreign inflows, so far this

month.