Oct 1 (Reuters) - A look at the day ahead in Asian

markets.

Investors in Asia kick off the new quarter on Tuesday catching

their breath from an astonishing end to the third quarter that

saw Chinese stocks clock their best day since 2008 and Japanese

stocks register one of their biggest falls in years.

On top of that, Fed Chair Jerome Powell on Monday dampened

some of the more fervent hopes for future rate cuts, saying his

base case is for a further 50 basis points easing this year and

that the central bank will reach its neutral rate "over time."

This pushed Treasury bond yields higher - most notably at

the short end of the curve where the two-year yield leaped 10

basis points - and traders shifted expectations for November's

Fed meeting closer to a 25 bps cut from 50.

Tuesday's economic calendar is packed with top-tier releases

including Japanese unemployment, Indonesian inflation, South

Korean trade, and a raft of purchasing managers index reports

from across the Asia and Pacific region.

Of course, Powell's remarks weren't hawkish. But they were a

reminder that perhaps some of the rate expectations built into

market pricing had gotten a little extreme.

Wall Street closed in the green on Monday, rounding off a

solid quarter that saw the S&P 500 reach multiple new peaks and

increased rotation out of Big Tech into beaten down sectors and

small cap stocks.

Investors in Asia on Tuesday will digest this and the

remarkable market moves in the continent's two biggest economies

the day before.

Chinese markets are now closed until Tuesday next week as

the country celebrates Golden Week. The market break could not

have been better timed.

Monday's 8% surge means Chinese stocks have risen by around

a quarter since Sept. 23, when Beijing unveiled the first of a

series of stimulus measures to support the economy and markets.

A 25% increase, in a week, is nothing less than extraordinary.

Blackrock ( BLK ), the world's largest asset manager, has

raised its tactical asset allocation for China to "modestly

overweight" from "neutral."

Unsurprisingly, the equity market's historic rebound is

pouring fuel on the burning question of whether China's stimulus

will revive the economy. On that score, far more uncertainty

abounds.

A fundamental issue is that lower borrowing costs and more

ample market liquidity won't increase consumer demand in an

economy dealing with a monumental property sector bust, the

deleveraging that goes with that, and deflation.

Japanese stocks, meanwhile, will be looking to bounce back

from a near-5% slump on Monday, as investors gear up for an Oct.

27 election. That was the biggest fall since the Aug. 5

volatility shock, and the third biggest since the early days of

the COVID-19 pandemic in March 2020.

The yen's slide back towards 144.00 per dollar should help.

Here are key developments that could provide more direction

to Asian markets on Tuesday:

- Japan unemployment (August)

- Indonesia inflation (August)

- PMIs - Australia, India and others (September)