EMERGING MARKETS — Jakarta stocks plunge 11% as MSCI set to drop Indonesia from indexes

Oct 16 (Reuters) — Indonesian stocks tumbled more than 11% on Friday and the rupiah weakened sharply after index provider MSCI said the Jakarta stock market was no longer worthy of "emerging market" status, in a major setback for Southeast Asia's biggest economy. Jakarta's benchmark index plunged 8% at the open, triggering a 30-minute trading halt, before extending losses. It fell as much as 11% after trading resumed, heading for its steepest one-day drop since January 1998. The index has now lost nearly 40% this year, making it the worst-performing share market in the region. The rupiah weakened to 18,070 per US dollar, the lowest since early August and approaching its lifetime low of 18,190. "MSCI considers Indonesia's continued classification as an Emerging Market no longer appropriate and is launching a consultation on a proposal to reclassify Indonesia as a Standalone Market," the index provider said. A "standalone" status would exclude Indonesian stocks from global indexes tracked by billions of dollars in passive investment, forcing funds that follow or are ranked against the indexes to sell. Elsewhere in emerging Asia, South Korean equities rebounded 2.5% after losing over