Possible scenario
Regional Military Escalation
20% Chance
Iran or aligned militias retaliate against the blockade through missiles, drones, mines, cyberattacks, or proxy strikes. The United States responds militarily, raising the risk that the Hormuz closure expands into a broader Gulf conflict.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
- Copper Down
Secondary impacts
- Energy
Portfolio impact
S&P 500-2.3%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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