* Resurgent dollar clocks second week of gains
* Asian equities log worst week in nearly one year
* Rupiah logs worst week since March 2020

By Roushni Nair
       April 19 (Reuters) - Emerging Asian equities and
currencies were sharply lower on Friday as reports that Israel
attacked Iran in an escalation of tensions in the Middle East
led investors to dump risk assets and flee toward safe-haven
assets, including the U.S. dollar.  
    South Korean won fell 0.7% against the dollar by
0410 GMT, leading the decline in the region, while the
Indonesian rupiah depreciated as much as 0.7%, to mark
its lowest level since April 8, 2020.
    MSCI's emerging market currency index fell
by 0.5% to its weakest level since Nov. 17. The index, which has
been hobbled by a resurgent dollar this year, is on track to
mark its worst week since Jan. 19, having already given up
nearly 0.5% this week. 
    Asian equities followed suit with massive losses as
sentiment went sour after reports indicated Israel had hit Iran
earlier in the day. Equities in Bangkok, Seoul
and Manila all retreated nearly 2%. 
    MSCI's broadest index of Asia-Pacific shares outside Japan
 sank to its worst week since June 23, 2023,
losing nearly 4% so far.
    A hawkish repricing of interest rate cut expectations for
the U.S. Federal Reserve has kept the dollar buoyant to the
detriment of riskier Asian currencies, after strong U.S. data
and statements from policymakers indicated the fight against
inflation is not over.
    The U.S. dollar index - a measure of the greenback
against six major rivals - was last at 106.19, just below the
five-month peak of 106.51 touched earlier this week. The index
has been gaining for two straight weeks. 
    "We continue to see dollar strength weigh on EM Asia FX
performance in the near term as markets re-price expectations
for a rate cut from the Fed this year, with geopolitical
tensions in the Middle East expected to further exacerbate
pressure on EM Asia assets," Aditya Sharma, emerging market
strategist at NatWest Markets, told Reuters. 
    In Asia, the rupiah is set for its worst week since March
2020, giving up nearly 3% so far. 
    Indonesia's high-yielding bond market has also lost appeal
due to currency volatility and the wafer-thin spreads it offers
over dollar markets, with market participants now pricing in the
possibility that Bank Indonesia (BI) will start hiking rates.
    The Philippine peso and Taiwan dollar lost
more than 4%, each, while Thailand's baht was
marginally down 0.2%. The peso is set for its worst week since
February 2023. 
    In Malaysia, the economy is estimated to have grown 3.9% in
the first quarter of 2024 from a year earlier, driven by growth
in its services sector. 
    The ringgit traded largely flat, while equities in
Kuala Lumpur advanced 0.4%. 
    
    HIGHLIGHTS:    
    ** Indonesian 10-year benchmark yields rise 9.9 basis points
to 7.009%
    ** Malaysia's March exports fall 0.8% y/y
 
    
  Asia stock indexes and                                 
 currencies at 0449 GMT                             
 COUNTRY  FX RIC        FX     FX     INDEX  STOCK  STOCK
                     DAILY  YTD %                S  S YTD
                         %                   DAILY      %
                                                 %  
 Japan               +0.18  -8.61            -2.35  11.71
 China                                            
 India               +0.05  -0.34            -0.47   0.74
 Indones             -0.61  -5.38            -1.45  -2.88
 ia                                                 
 Malaysi             +0.08  -3.91             0.43   6.65
 a                                                  
 Philipp             -0.37  -3.67            -1.71  -0.59
 ines                                               
 S.Korea                                          
 Singapo             -0.03  -3.18            -0.59  -2.20
 re                                                 
 Taiwan              -0.47  -5.52            -3.27   9.52
 Thailan             -0.20  -7.32            -1.80  -5.60
 d                                                  
 
    
 (Reporting by Roushni Nair in Bengaluru; Editing by Tom Hogue)