EMERGING MARKETS-Asian emerging market stocks set for worst day in 16 years

By Himanshi Akhand

April 7 (Reuters) - Asian emerging market stocks slumped on Monday to head for their worst day in over 16 years, as steeper-than-expected U.S. tariffs under President Donald Trump stoked fears of a global downturn.

The key gauge of Asian emerging market equities .MIMS00000PUS fell 8.9% and was on track for its biggest one-day drop since October 2008.

Taiwan stocks .TWII slumped 9.7%, posting their worst session on record, while shares in Singapore .STI fell 7.8%.

China, which is now facing U.S. tariffs of over 50%, slapped extra levies of 34% on all U.S. goods and export curbs on some rare earths, while Trump said that investors would have to take their medicine and he would not do a deal with China until the U.S. trade deficit was sorted out.

Shanghai stocks .SSEC slumped 7.3% in their worst session in over five years.

Tariffs on export-driven Southeast Asian nations were some of the biggest, with a 46% levy on Vietnamese exports and 37% on Thailand.

"The lack of any policy response from the Trump administration on the market sell-off is adding to the uncertainty, reinforcing the idea that the current trajectory may remain unchanged in the near term," said Charu Chanana, chief investment strategist at Saxo in Singapore.

"Unless we see a clear pivot from policymakers, volatility is likely to stay elevated, and the path of least resistance for risk assets remains to the downside."

Stocks in South Korea .KS11, the Philippines .PSI and India .NSEI dropped between 4.3% and 5.6%.

Meanwhile, the rising risk of recession prompted futures markets to price in almost five quarter-point cuts in U.S. interest rates this year, weighing on the dollar. MKTS/GLOB

China's yuan CNY=CFXS slipped to its lowest since January and Malaysia's ringgit MYR= slipped 0.6%.

Indonesian markets are due to reopen on Tuesday after a week of holidays with investors watching closely for their initial reaction to U.S. tariffs.

The rupiah IDR= has already fallen nearly 3% this year and two weeks ago reached a level not seen since 1998 due to concerns over domestic fiscal health, government policies and weakening domestic demand.

The central bank of Southeast Asia's largest economy said it would "intervene aggressively" in domestic foreign exchange markets when they reopen.

HIGHLIGHTS:

Singapore banks - DBS DBSM.SI, UOB UOBH.SI and OCBC OCBC.SI slump between 5.3% and 9.4%

Japan's Nikkei sinks to 1-1/2-year low .T

*Taiwan announces temporary short-selling curbs after US tariffs

Markets in Thailand, Indonesia and Vietnam closed for a holiday