GLOBAL MARKETS-Wall St futures, oil plunge, markets bay for US rate cuts

By Wayne Cole

SYDNEY, April 7 (Reuters) - Asian markets were in for a rough start on Monday as Wall Street futures plunged and markets wagered the mounting risk of a U.S. recession could see U.S. rate cuts as early as May.

S&P 500 futures ESc1 slid 3.9% in extremely volatile early trade, while Nasdaq futures NQc1 dived 4.8%, adding to last week's almost $6 trillion in market losses on worries over the fallout from a global trade war. .N

Nikkei futures NKc1 slid almost 4% to 31,080, pointing to a drop of up to 3,000 points for the cash index that closed at 33,780 on Friday .N225.

The carnage came as White House officials showed no sign of backing away from their tariff plans, and China declared the markets had spoken on their retaliation through levies on U.S. goods.

The flight to safe havens saw Treasury futures TYc1 surge a full point, a very rare move for Asian trade, while Fed fund futures 0#FF: jumped to price in an extra quarter-point rate cut from the Federal Reserve this year. USDIRPR

Markets even implied around a 70% chance the Fed could cut as soon as May, even though Chair Jerome Powell on Friday said the central bank was in no hurry on rates.

That dovish turn saw the dollar slip another 1% on the safe-haven Japanese yen to 145.38 yen JPY=EBS, while the euro held firm at $1.0987 EUR=EBS.

"The size and disruptive impact of U.S. trade policies, if sustained, would be sufficient to tip a still healthy U.S. and global expansion into recession," said Bruce Kasman, head of economics at JPMorgan, putting the risk of a downturn at 60%.

"We continue to expect a first Fed easing in June," he added. "However, we now think the Committee cuts at every meeting through January, bringing the top of the funds rate target range down to 3.0%."

The gloomier outlook for global growth kept oil prices under heavy pressure, following steep losses last week. O/R

Brent LCOc1 fell $2.05 to $63.53 a barrel, while U.S. crude CLc1 dived $2.07 to $59.92 per barrel.

Even gold was caught up in the selloff, easing 0.6% to $3,018 an ounce XAU=. GOL/

To read Reuters Markets and Finance news, click on  https://www.reuters.com/finance/markets For the state of play of Asian stock markets please click on: 0#.INDEXA