Possible scenario
Saudi Response Escalates
18% Chance
Riyadh concludes that repeated attacks require a military response against Houthi launch infrastructure in Yemen, potentially with U.S. intelligence support. This would mark a sharper break from the 2023 de-escalation track and produce a larger, though still not crisis-level, risk premium in oil.
Initial impacts
- Market volatility Up
- Riskier companies' borrowing costs Up
- Oil prices Up
- 10-year Treasury yield Down
- US dollar Up
Secondary impacts
- Energy +1.9%
Portfolio impact
S&P 500-0.8%
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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