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* Futures up: Dow 3.4%, S&P 500 2.53%, Nasdaq 3.24%

April 8 (Reuters) - U.S. stock index futures jumped on

Wednesday as investors breathed a sigh of relief after the U.S.

and Iran agreed to a two-week ceasefire, sending crude prices

lower on expectations that energy supplies from the Middle East

could resume.

The announcement late on Tuesday came hours before Trump's

deadline, after which he said the U.S. would inflict devastating

attacks on Iran's civilian infrastructure if Tehran did not

reopen the strategic Strait of Hormuz.

The rally was visible across global asset classes. Equity

indexes in major Asian and European markets shot up between

4%-5%, while crude prices rolled 16% to near $90 a barrel, and

the dollar, which had seen safe-haven interest over the past

month, fell 1% against the Japanese yen.

Investors have been navigating the ebb and flow of the

conflict that has extended to over a month, as Trump suggested

an earlier end to the war several times, while on the flipside,

Iran has denied all reports of negotiations.

The worry is that the prolonged conflict and soaring energy

costs could weigh on economic growth and complicate the Federal

Reserve's monetary policy path. March was the benchmark S&P

500's biggest monthly fall in a year.

Short-term Treasury bond yields, a reflection of interest

rate expectations, slipped on Wednesday, and interest rate

futures suggest investors expect the Fed to keep borrowing costs

unchanged this year, according to LSEG-compiled data.

Before the war, traders had been betting on at least

two 25-basis-point interest rate cuts this year, but at one

point last month, inflation concerns had them wagering on a

potential rate hike.

At 03:17 a.m. ET, Dow E-minis were up 1,083 points,

or 2.31%, and S&P 500 E-minis were up 168.5 points, or

2.53%. Nasdaq 100 E-minis were up 790.5 points, or 3.24%

Futures tracking the rate-sensitive Russell 2000 Index

jumped 3.4%, while contracts tracking the CBOE

Volatility Index, Wall Street's fear gauge, slid 4.8

points to over a two-week low.