Jan 28 (Reuters) - A look at the day ahead in Asian

markets.

The U.S. tech juggernaut suffered a sharp setback on Monday,

setting global markets up for a volatile ride this week, with

mega-cap earnings on deck, the Fed's meeting, and lingering

uncertainty over U.S. President Donald Trump's trade policies.

U.S. stocks tumbled on Monday, led by tech shares, as the

growing buzz around Chinese startup DeepSeek's low-cost AI model

sparked concerns about the sector's high valuations.

Selling on Asian exchanges outside China spilled over into U.S.

stock futures. The S&P 500 dropped about 1.5% after hitting an

all-time high last week and the Nasdaq swooned more than 3%,

while Nvidia ( NVDA ), whose chips are the top choice for

powering AI applications, dropped about 17%.

Investors meanwhile flocked to U.S. Treasuries in a flight to

safety, pushing benchmark 10-year yields down 10 basis points to

4.53%. The dollar index fell 0.1% to its lowest since

Dec. 18.

Foreign competition to the U.S. dominance in artificial

intelligence has sparked broader concerns over valuations in

U.S. equities, where Big Tech shares have led stocks higher over

the past couple of years.

This means all eyes will be on a wave of earnings reports

this week, with megacap tech giants Tesla, Meta

, Microsoft ( MSFT ), and Apple ( AAPL ) set to take

center stage. Investors will be hunting for clues on when the

hefty bets on artificial intelligence will begin to pay off in a

meaningful way.

Meanwhile U.S. trade policies remain a key market theme.

China, Mexico, and Canada remain on edge as Trump last week

marked Feb. 1 as the date for imposing additional tariffs on the

major U.S. trading partners.

And while so far he has refrained from implementing broad trade

levies, on Sunday Trump threatened Colombia with tariffs and

sanctions to punish it for refusing to accept military flights

carrying deportees. Colombia later said it would accept the

military aircraft and the U.S. sanctions threat was put on hold,

but investors got a taste of how Trump's trade decisions could

surprise markets.

Later this week, the Fed's first meeting of 2025 will be a major

focus for investors trying to decipher how Trump's economic

policies will impact the U.S. central bank's views on growth and

inflation.

U.S. policymakers are expected to leave interest rates

unchanged at their rate-setting meeting, which starts on Tuesday

and ends on Wednesday, but Trump may complicate the Fed's job

going forward, after he said last week he wants the Fed to lower

borrowing costs.

The European Central Bank meanwhile will meet on Thursday

for the first time since Trump returned to office. It is largely

expected to cut the key deposit rate by another 25 basis points,

but investors will look for hints on the path ahead as the

threat of U.S. tariffs clouds the European economic outlook.

The economic data calendar in Asia is light on Tuesday, and

many bourses have extended holidays this week for the Lunar New

Year. Markets in mainland China are shut from Tuesday and do not

reopen until Feb. 5, while Singapore's financial markets will be

closed for a half day on Tuesday and closed for all of Wednesday

and Thursday, for national holidays.

Here are key developments that could provide more direction

to markets on Tuesday:

- Japan service PPI (Dec)

- Australia Business Confidence Index

- U.S. durable goods (Dec)

- U.S. 7-year Treasury auction