By Jamie McGeever

(Reuters) – A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist.

The most important Asian economic indicator from a pretty packed calendar on Wednesday, and biggest potential market-mover, will be China’s services purchasing managers index report for June, which comes amid the latest ratcheting up of U.S.-Sino tensions.

Traders will also have Japanese, Australian and Indian services PMIs to digest, as well as the latest inflation data from Thailand and the Philippines, and can expect trading volume to return to more normal levels after the July 4 U.S. holiday.

Currency traders are on high alert for intervention from authorities in Beijing and Tokyo to slow the slide in the yuan and yen, respectively, while Asian stocks ex-Japan will be looking to rise for a fourth day in a row – a winning streak not seen for two months.

The main focus, however, will be on China. The economy has sputtered this year, triggering downward revisions to GDP growth estimates, widespread underperformance of Chinese assets, and increasing calls for fiscal and monetary stimulus.

China’s economic surprises index shows just how much recent data have undershot analysts’ expectations – it is deeply negative, tumbling fast, and at its lowest in six months.

Service sector activity, however, has held up reasonably well and has expanded every month this year, according to the PMI data. A solid number could help soothe investors’ concerns.

The yuan rose to a one-week high against the dollar on Tuesday as the central bank fixed the currency higher and major state banks again lowered their dollar deposit rates as authorities stepped up efforts to arrest the yuan’s slide.

The political backdrop to this is the latest flare up in U.S.-Sino tensions.

China abruptly announced on Monday a series of curbs from Aug. 1 on exports of some metals widely used in semiconductors and electric vehicles, ramping up a trade war and potentially causing more disruption to global supply chains.

This comes ahead of a planned visit to Beijing by U.S. Treasury Secretary Janet Yellen this week.

Elsewhere in local FX markets, the Australian dollar rose for a fourth day on Tuesday after the Reserve Bank of Australia left its benchmark cash rate on hold at 4.10%.

This was the second time in the RBA’s tightening cycle it has stood pat on rates following April’s shock pause, but was far less of a surprise – money markets had put only a one-in-three probability on a hike to 4.35%.

Aussie bulls latched onto the RBA’s warning that further tightening might be needed to tame inflation, and overnight swaps are still pointing to almost 50 basis points of further tightening this year.

Here are key developments that could provide more direction to markets on Wednesday:

– China, Japan, India, Australia services PMIs (June)

– Philippines CPI inflation (June)

– Thailand CPI inflation (June)

(By Jamie McGeever; Editing by Alistair Bell)

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