Possible scenario
Limited Retaliation
25% Chance
Saudi Arabia responds militarily to restore deterrence, most likely with strikes on Houthi launch infrastructure in Yemen. The escalation is material but remains below a full regional war unless Houthi retaliation expands to energy or shipping targets.
Initial impacts
- Market volatility Up
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +1.7%
Portfolio impact
S&P 500-1.0%
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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