* Futures down: Dow 189 pts, S&P 20.75 pts, Nasdaq 46.75 pts
By Tanya Agrawal
Feb 7 (Reuters) - U.S. stocks were set to open more than half a percent lower on Wednesday, an almost 2 percent gain in the previous session failing to calm the nerves which drove Wall Street's biggest intraday fall on record on Monday. All three of Wall Street's main indexes were on course for falls of between 0.5 percent and 0.7 percent, according to volatile premarket futures trading.
A wild session on Tuesday saw the Dow Jones Industrial Average swing more than 1,100 points from peak to trough and ended with the benchmark S&P 500 tallying its best day since just before President Donald Trump's election in 2016.
Traders are bracing for higher volatility as they try to figure out if the swings of the past two days are the start of a deeper correction or just a temporary blip in the U.S. market's nine-year bull run.
The pivotal gauge of S&P 500 volatility, the VIX, opened at a relatively elevated 31 percent. The VIX on Tuesday hit a more than two-and-a-half year high above 50, after trading, on average, below 20 for months.
Markets are also on edge over U.S. lawmakers' wrangling to extend the so-called debt ceiling - funding for the U.S. government runs out on Feb. 8 unless a stopgap bill manages to pass the Senate later on Wednesday.
The S&P 500 remains up 26 percent since Trump's election, and on Tuesday clawed back into positive territory for 2018, up 0.8 percent.
However, some investors fear that the market is over-stretched in the context of higher inflation and rising bond yields as central banks withdraw their easy money policies of recent years.
U.S. 10-year yields rose back as high as 2.80 percent after approaching two-week lows around 2.65 percent on Tuesday . They were last trading at 2.76 on Wednesday.
European markets were calmer, while Asian markets were mixed. The recent rout has wiped about $4 trillion off world equities.
Among stocks, Walt Disney was up 1.9 percent in premarket trading after the media company's quarterly profit topped forecasts.
Snapchat owner Snap soared 23.7 percent after it reported surging growth in users and revenue in its latest quarter.
Chipotle Mexican Grill fell 7.5 percent after the burrito chain said the number of visitors to its restaurants fell in the fourth quarter and would continue to decline through the middle of the year. (Reporting by Tanya Agrawal; Editing by Arun Koyyur)