Possible scenario
Houthi Retaliatory Escalation
20% Chance
The Houthis respond to the planned offensive by widening the conflict against Saudi energy infrastructure, Red Sea shipping, and coalition naval forces. This is less likely than a stalemate but carries the largest near-term market shock because it threatens both oil exports and a chokepoint used by global trade.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Market volatility Up
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +3.3%
Portfolio impact
S&P 500-1.7%
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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