Aug 6 (Reuters) - A look at the day ahead in Asian

markets.

Asian markets open on Tuesday still reeling from a wild session

on Monday that saw Japan's second-biggest stock crash ever spill

over into world markets, helping to unleash a wave of volatility

usually associated with major crises.

The curious thing is though, there's no smoking gun that

explains the scale of the selloff, either in Japan or globally.

At least not a singular or obvious one.

Yes, the yen carry and other leveraged trades were probably

overcooked, the Bank of Japan was maybe too hawkish and is now

headed for a policy error, ditto the Fed by not cutting rates

last week, and the AI-inflated Big Tech bubble on Wall Street

was well overdue a reversal.

But is that enough to warrant a 12% plunge in Japanese

stocks - a fall only exceeded by the 15% slump on Oct. 20, 1987

after Black Monday - or the surge to 65.0 on the U.S. VIX

volatility index, a level only ever topped in the market

meltdowns of 2008 and 2020?

Perhaps.

But there's a case to make that it's excessive. On the

economic side, there's no obvious sign of collapse - Japanese

and U.S. services purchasing manager index numbers on Monday

showed pretty solid growth.

Indeed, the U.S. services PMI data was enough to push

short-dated Treasury yields higher on Monday, halting the recent

decline that had also reached historical magnitudes.

This is the febrile atmosphere traders in Asia on Tuesday

will received the Reserve Bank of Australia's latest policy

decision, inflation figures from Taiwan and the Philippines, and

more corporate results from Japan.

The RBA is widely expected to hold rates at 4.35% but could

the current turmoil force a cut? Traders are putting a one-in-10

probability on it.

It remains to be seen whether the current volatility proves

to be a market-centric episode wiping out leveraged trades

across a range of assets without spilling over into the "real"

economy, or something more serious.

There have already been calls in some quarters for an

emergency, inter-meeting Fed rate cut and earlier on Monday U.S.

rates markets had begun to price in the possibility of just that

or a 75 basis point cut next month.

But unless there is a clear deterioration in the economic

data or deeper market dislocation, this is unlikely. By the U.S.

close on Monday that pricing had eased and the VIX index had

halved from its peak.

Classic "safe haven" assets gold and two-year Treasuries

ended lower, although the yen hit a seven-month high. It has

rallied around 13% in three weeks, virtually wiping out its

year-to-date losses.

Further signs of yen stress and dislocation may come from

the cross-currency basis market, a gauge of funding costs and

demand for dollars. Traders will be watching.

Here are key developments that could provide more direction

to markets on Tuesday:

- Australia interest rate decision

- Philippines inflation (July)

- Taiwan inflation (July)