Indonesian and Vietnam stock markets plunged on Thursday as rising U.S. treasury yields and a stronger dollar prompted foreign investors to trim holdings in emerging market equities.

Benchmark U.S. Treasury 10-year yield edged above 3 percent on Wednesday and may likely reach levels last seen in mid-2011.

Indonesian stocks slumped 2.8 percent in their fifth straight session of losses, bringing their year-to-date losses to 7 percent.

The country's index of 45 most liquid stocks dropped 3.6 percent in the session.

Bank Central Asia fell 1.8 percent, while Telekomunikasi Indonesia (Persero) Tbk Perusahaan Perseroan slid 3.4 percent.

The rupiah has depreciated nearly 5 percent against the U.S. dollar since late January as a broad rally in the greenback triggered capital outflows. The country's central bank intervened by buying sovereign bonds and selling foreign currency to arrest the rupiah's fall.

The Indonesian rupiah yield curve's sharp flattening suggests a build-up of rate-hike expectations, Standard Chartered said in a note. The Indonesian central bank has kept key interest rates unchanged for the past seven months.

"It's a tricky situation for the government and the central bank as they have to contemplate whether to focus on growth or stability," said Taye Shim, head of research at Mirae Asset Sekuritas.

Vietnam stocks plummeted 3.3 percent to their lowest close in more than two months as financials and utilities weighed on the benchmark. Petrovietnam Gas Joint Stock Corp was the biggest drag on the index, falling as much as 7 percent, its biggest intraday drop in over two years.

Losses in energy and material stocks pushed Thai shares 0.4 percent lower.

Philippine shares reversed earlier losses in the session to close 0.8 percent higher, buoyed by real estate stocks. Index heavyweight Ayala Land Inc rose 3 percent, while JG Summit Holdings Inc gained 3.8 percent.

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