EMERGING MARKETS-AI optimism propels South Korea, Taiwan shares to record highs; regional FX slips

By Roshan Thomas

Feb 24 (Reuters) - Artificial intelligence‑linked stocks in South Korea and Taiwan climbed on Tuesday, helping both markets notch record closing highs, as investors shrugged off overnight worries about AI’s potentially disruptive impact on software and other sectors.

Currencies in emerging Asian economies inched lower against the dollar index USD= that clawed back losses as investors assessed the global trade impact of renewed turbulence surrounding U.S. President Donald Trump's tariff regime.

Analysts at MUFG said export-oriented currencies such as the South Korean won KRW=KFTC, Malaysian ringgit MYR= and, to a lesser extent, the Chinese yuan CNY=CFXS were better positioned to weather Trump's tariffs, while the Indian rupee INR=IN and Indonesian rupiah IDR= were likely to lag.

The Philippine peso PHP= shed 0.3%, while the Thai baht THB=TH and Indonesian rupiah lost 0.4% and 0.2%, respectively.

The MSCI index of emerging Asian equities .MIMS00000PUS climbed 0.7% to a record level, buoyed by a 2.1% rise in South Korea's KOSPI .KS11 and a nearly 3% gain in Taiwan stocks .TWII. The two tech-heavy markets account for about 40% of the MSCI index.

The regional IT gauge .MIMS0IT00PUS climbed 3.2% to an all-time high.

Overnight, Wall Street came under pressure amid concerns over AI's disruptive impact and Trump's erratic statements on trade policy.

Despite the broad weakness, South Korean shares extended their rally, closing at an all-time high of 5,969.64, around 30 points below the 6,000 level.

Investors are now focused on AI bellwether Nvidia's NVDA.O earnings, due on Wednesday.

"The market knows that if Nvidia guides strongly again, it will help reinforce the whole AI supply chain narrative, and Korean memory producers sit right in the middle of all that," said Zavier Wong, a market analyst at eToro.

"So in some sense, this looks like pre-positioning around that expectation, with some confidence already priced in."

Taiwan stocks also closed at an all-time high of 34,700.82, with top contract chipmaker TSMC 2330.TW up 3.4%.

Tight advanced-node order books and sustained earnings momentum should keep global money rotating into Taiwan, with confidence in demand and margins supporting tolerance for concentration risk, Wong said.

Thai shares .SETI were flat as investors braced for the Bank of Thailand's policy decision on Wednesday, where the central bank is widely expected to stand pat on interest rates, as per a Reuters poll.

Malaysian .KLSE and Singapore .STI shares both lost 0.5%, while Philippine stocks .PSI climbed 0.9%.

HIGHLIGHTS:

Taiwan seeks U.S. assurances tariff deal terms will not change

Malaysia monitoring U.S. tariff situation closely, PM says

China leaves benchmark lending rates unchanged for ninth straight month