Possible scenario
Regional Escalation
20% Chance
The Houthis retaliate beyond the immediate battlefield, drawing deeper Saudi, U.S., and possibly U.K. involvement. This outcome is less likely than a stalemate but credible because the Houthis have previously used missiles and drones against Saudi infrastructure and Red Sea shipping.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +4.0%
Portfolio impact
S&P 500-2.0%
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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