Possible scenario
Retaliation Spiral
20% Chance
The deterrence tool triggers a more confrontational Chinese response, with Beijing linking rare-earth, battery-material, or customs approvals to EU treatment of Chinese firms. This would mark a clear escalation from legal leverage to reciprocal economic coercion.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Copper Down
- US dollar Up
Secondary impacts
- Technology -2.3%
- Industrials
Portfolio impact
S&P 500-1.8%
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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