* Global stocks tumble
* North Korea on war footing
* Fears mount over euro-zone banking system
* Futures off: Dow 218 pts, S&P 28.2 pts, Nasdaq 42 pts
* For up-to-the-minute market news see [STXNEWS/US]
By Edward Krudy
NEW YORK, May 25 (Reuters) - U.S. stock index futures fell sharply on Tuesday, tracking a steep sell-off in global equities, on worries over Europe's banking sector and as North Korea threatened military action against the South.
* World stocks slid, with Japan's Nikkei closing down 3.1 percent and European shares dropping 3 percent on renewed worries over the euro-zone banking sector after the Bank of Spain rescued a local bank over the weekend.
* Global stocks as measured by MSCI fell 2 percent to their lowest since early Sept 2009.
* North Korea's war-like rhetoric hit Seoul's markets, sending the government into emergency session to seek ways to calm investors. The threats following the sinking of a South Korean warship by the North. For details, see [ID:nSGE64O03B]
* Some big banks and industrial stocks fell in premarket trading on fears that the Korean confrontation might derail a global economic recovery. Bank of America Corp (BAC.N) fell 3.1 percent, and Alcoa Inc (AA.N) fell more than 5.1 percent.
* "We have got another round of taking off the risk trade going on around the world, and we're doing it in pretty dramatic fashion," said Art Hogan, chief market analyst at Jefferies & Co in New York.
* Hogan said the pattern in recent days had been for the futures market to exaggerate the sell-off before the markets opened, adding that may be the case on Tuesday.
* S&P 500 futures SPc1 fell 28.2 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures DJc1 sank 218 points, and Nasdaq 100 futures NDc1 lost 42 points.
* The S&P 500 has entered a technical correction, falling more than 10 percent from a peak on April 23. If the index closes under its May 6 "flash crash" low of 1,065.79, chart-minded traders said greater losses may follow. The next important level is the February closing low of 1,056.74.
* The euro fell as euro-zone concerns strained money markets, boosting demand for dollars across the board. Crude oil futures fell 3.7 percent below $68 a barrel, while copper fell about 2 percent. Safe-haven U.S. Treasuries rallied.
* At 9 a.m. EDT <1300 GMT>, Standard & Poor's releases its S&P Case Shiller Home Price Index for March. Economists in a Reuters survey expected a fall of 0.3 percent versus a decline of 0.1 percent in the previous month. The data comes after the expiration of a government tax credit that may slow a housing market recovery.
* At 10 a.m. EDT <1400 GMT>, the Conference Board releases May consumer confidence. Economists forecast a reading of 59.0, compared with 57.9 in April. (Reporting by Edward Krudy; editing by Jeffrey Benkoe)