U.S. stock index ⁠futures kicked off a holiday-shortened week with gains on Monday, after the indexes logged sharp declines in the previous ‌session, as investors assessed the impact of the escalating Middle East conflict.

Yemen's Iran-backed Houthi militia entered the war over the weekend and more ​U.S. troops arrived in the Middle East as President Donald Trump said he wanted to "take the oil in Iran" in a Financial Times ​interview.

Still, investors ​drew comfort from Trump's comments that the U.S. and Iran had been meeting "directly and indirectly" and Pakistan, acting as intermediary, said "meaningful talks" could be hosted in coming days.

"The market is grappling with two major unknowns that ⁠feed directly into each other: when oil flows will resume in meaningful volumes, and at what price level oil switches from an inflation story to a recession story," said Stefan Koopman, senior macro strategist at Rabobank. Koopman also said seizing Iran's Kharg Island would only choke its export capacity and push global oil prices higher.

Oil prices gained again on Monday and energy ​stocks inched higher with ‌Exxon Mobil and ⁠Chevron up about 1.4% each ⁠in premarket trading.

Wall Street's main indexes ended their fifth consecutive week in the red on Friday, and the blue-chip Dow confirmed ​it was in correction territory after closing more than 10% below its record high.

The Nasdaq and ‌the small-cap Russell 2000 have also confirmed correction territory since the war ⁠began. The benchmark S&P 500 is a little over 1% away.

Wall Street brokerage Morgan Stanley downgraded global equities to "equal weight" from "overweight", but said fund flows to U.S. equities and bonds had overtaken the rest of the world since the conflict began, indicating it might re-emerge as a safe haven for investors.

At 05:25 a.m. ET, Dow E-minis were up 156 points, or 0.34%, S&P 500 E-minis were up 26 points, or 0.41% and Nasdaq 100 E-minis were up 87.75 points, or 0.38%.

U.S. markets will be shut on Friday for the Good Friday holiday.

The spike in oil prices resulting from the Iran conflict has revived inflation fears, putting central banks in a tough spot with regard to interest rates.

Money ‌market participants are not pricing in any easing from the Federal Reserve this ⁠year, compared with two cuts before the war began, per CME Group's FedWatch Tool.

A ​host of labor market data including the nonfarm payrolls figures for March are scheduled for release this week and that could provide more insights on the health of the economy.

Comments from Fed Chair Jerome Powell and New York Fed President John Williams ​later in the ‌day will also be parsed.

Shares of aluminum producers climbed before the bell as prices of ⁠the metal were trading around four-year peaks. ​Alcoa and Century Aluminum gained 8.4% and 7.2%, respectively.

(Reporting by Purvi Agarwal in Bengaluru; Editing by Devika Syamnath)