Possible scenario
Limited Military Escalation
17% Chance
Talks stumble and both sides intensify coercive moves around the strait without launching a full war. This scenario is less likely than a dragged-out negotiation, but the naval proximity and public bargaining over sanctions create meaningful accident risk.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Consumer Services -3.6%
Portfolio impact
S&P 500-1.4%
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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