There will most likely be some sort of Israel response, starting with a closure on Arab areas in the territories, but I think the US will consult Israel and tell it to restrain itself due to its moves right now to try to get the roadmap to "peace" back on track.
As you know, the US does not support Israel targeting terrorists nor does it support going after Arafat.
But if Israel is to act militarily, it will probably be directed at terrorist infrastructure in Judea Samaria and maybe terrorist HQ's in Gaza.