Banking blip? Not so fast

April 26 (Reuters) – An unholy trinity of US developments on Tuesday – poor corporate earnings, a bank’s value going up in smoke, and slumping consumer confidence – will likely set an extremely gloomy tone for Asian markets on Wednesday.

This will be the backdrop to trade figures from Thailand and New Zealand, industrial production data from Singapore and inflation figures from Australia.

The three main indexes on Wall Street closed down between 1% and 2% – the Nasdaq’s 2% fall was its steepest in six weeks – as fears over the recession and the banking sector intensified.

The travails at First Republic Bank FRC should be a wake-up call to anyone who thought the US banking turmoil had somehow been cleared up in a matter of weeks.

After reporting on Monday a plunge of more than USD 100 billion in deposits in the first quarter, shares on Tuesday plunged 50% at the bank – the 15th largest in the country at the start of the year. The bank has lost 93% of its value this year.

The wider US regional banking index’s 4% slide – its fourth straight decline – took its year-to-date decline to 25%.

Notably, the plunge in US bond yields and Fed expectations on the back of this did not weaken the dollar – safe-haven buying pushed it up 0.5% for one of its best days since the banking shock in mid-March.

Safe-haven flows dominated trading on Tuesday, with the Japanese yen, Swiss franc, government bonds and gold all posting strong gains.

If there is a tailwind for Asian markets on Wednesday amid the headwinds it will be the after-hours results from Google’s parent company Alphabet (GOOGL) and Microsoft (MSFT). Profits at both tech giants topped Wall Street estimates, and shares in both rose 4% in after-hours trading.

On the economic data front on Wednesday, Australian weighted annual CPI inflation is expected to have finally slowed in the first quarter to 6.9% from a 33-year high of 7.8%.

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

– Australia CPI inflation (Q1)

– Singapore manufacturing (March)

– Thailand trade (March)

(By Jamie McGeever; Editing by Josie Kao)