Possible scenario
Regional Escalation
20% Chance
Military action expands beyond maritime escorting as Saudi Arabia and the United States target Houthi missile batteries, radar, and port facilities. The main risk is that Iranian advisers, Iraqi militias, or Gulf energy infrastructure become involved, transforming a Red Sea blockade into a wider regional security shock.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +4.8%
Portfolio impact
S&P 500-3.4%
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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