Possible scenario
Contained Military Escalation
40% Chance
The drone shootdown is treated as another hostile act in the Hormuz confrontation, but Washington, Tehran, and regional capitals avoid immediate large-scale war. The most likely path is limited military signaling, additional surveillance, and narrowly targeted actions around Qeshm and the Strait.
Initial impacts
- Market volatility Up
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +1.9%
Portfolio impact
S&P 500-0.7%
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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