US stock index futures were sharply lower yesterday, as fears of a US recession gripped investors, suggesting Wall Street will join a global equity markets plunge when they resume trading today.

Volume was active in spite of the US stock market being closed for the Martin Luther King Jr. Day holiday.

The sell-off in futures tracked global equities losses, as the MSCI's main index of world stocks hit its lowest level in over a year.

If US stocks open today at the levels futures are indicating, it would push the market dangerously close to bear market territory -- or a 20 percent drop from their peak in October. That would mark the end of the bull market that began in early October 2002.

"We're going for some tough slugging here," said Paul J. Nolte, director of investments at Hinsdale Associates in Hinsdale Illinois.

"The breadth and the depth of subprime and housing market and its impact on the economy has everybody concerned. Most of the indications are we are in a recession."

S&P 500 futures were down 52 points, far below fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.

Dow Jones industrial average futures dropped 403 points, and Nasdaq 100 futures slid 63.75 points.

The Standard & Poor's 500 index closed on Friday down 15.33 percent from its peak close on October 9.

One major stock index, the Russell 2000 index of small-cap stocks, fell into bear market territory last week.