Emerging Markets-EM equities slide as oil jumps on escalating Middle East tensions, FX muted

South Korean chipmaker SK Hynix 000660.KS, which had a stellar debut on the U.S. Nasdaq on Friday, dropped more than 15%, dragging the country's benchmark index .KS11 down 9% to its lowest level in more than two months.

Tech-heavy Chinese stocks .SSEC, .CSI300 fell nearly 2% to three-month lows, while equities in Taiwan .TWII were flat. A 1% gain in TSMC 2330.TW, after the world's largest contract chipmaker posted a record second-quarter revenue, capped losses.

"The chip trade is big in the retail community, especially in Asia... when the external environment changes, some of these retail traders may take flight," added Brooks.

S&P maintained Indonesia's credit rating at 'BBB/A-2', saying recent strains on its fiscal and external positions should be temporary and could be offset by stronger commodity prices and spending cuts. Local stocks .JKSE rose 1.9%.