Brent crude climbed back above $100 a barrel as the U.S. and Iran exchanged military strikes in the Strait of Hormuz, escalating tensions that threaten an already fragile cease-fire. Iran launched attacks on American warships in the strategic waterway, prompting the U.S. to strike Iranian military sites and casting doubt on ongoing peace negotiations.

U.S. equity futures rallied despite weakness in Asian and European markets, with all major indexes in green as investors looked past the immediate geopolitical turmoil. The dollar strengthened in response to the tensions, adding pressure on commodities and international earnings. Traders now await April's nonfarm payrolls data for insight into the U.S. labor market's health.

The confrontation in the Strait—through which roughly one-fifth of global oil shipments pass—raises the risk premium in energy markets already rattled by supply concerns. Market participants are pricing in the possibility of further escalation, with implications for Federal Reserve policy decisions and global economic growth.