Emerging markets and their currencies sold off on Thursday after a downward shift in risk appetite drove wary foreign investors into repatriating their funds.

Among the worst hit was South Korea, whose Kospi index in Seoul fell 6.7 per cent to 948.69 after heavy losses in the banking sector, where KB Financial lost 14.9 per cent and Hana Financial shed 14.7 – both close to falling by their 15 per cent daily limit.