By Susan Mathew and Devik Jain

(Reuters) – U.S. stock index futures slid more than 1% on Tuesday before recouping some of those losses as fears of escalating tensions in Ukraine gripped markets, pointing to another volatile session on Wall Street.

The United States and its European allies are set to announce fresh sanctions against Russia on Tuesday after President Vladimir Putin recognized two breakaway regions in eastern Ukraine and ordered troops to those regions, deepening Western fears of a new war in Europe.

Megacap growth names such as Inc, Apple Inc, Microsoft Corp, Meta Platforms Inc and Tesla Inc lost between 1.6% and 1.5% in premarket trading.

As investors flocked to the safety of bonds, U.S. Treasury yields tumbled. Shares of big banks including Bank of America Corp, Citigroup Inc and Goldman Sachs Group Inc slipped about 0.4% each. [US/]

Markets were shut on Monday for the Presidents’ Day holiday.

At 06:08 a.m. ET, Dow e-minis were down 60 points, or 0.18%, S&P 500 e-minis were down 7.5 points, or 0.17%, and Nasdaq 100 e-minis were down 86.25 points, or 0.62%.

“We’re in a very headline driven market right now. And that’s going to constantly impact how market sentiment is intraday,” said Craig Erlam, senior market analyst, UK & EMEA, OANDA.

“The latest move by Russia has now been priced in. But if troops are crossing the border, we start seeing conflict, then I think the markets have a lot more negativity to price in,” Erlam added.

All three indexes marked their second straight week in the red on Friday as fears about a Russian invasion of Ukraine and uncertainty around the Federal Reserve’s tightening plan roiled markets.

The CBOE volatility index, also known as Wall Street’s fear gauge, was last up 29.66, well above its long-term average of 20.

Oil stocks bucked the broader weakness, tracking a near 5% jump in crude prices as a potential conflict with Russia could tighten supplies. [O/R]

Exxon Mobil Corp rose 2.3%, while Chevron Corp added 1.9%. Others including Occidental Petroleum Corp , Marathon Oil Corp and Diamondback Energy Inc topped the S&P 500 in premarket trading, up between 3.9% and 5.2%.

(Reporting by Susan Mathew in Bengaluru; Editing by Anil D’Silva)