Possible scenario
Military Retaliation Follows
18% Chance
Washington and Abu Dhabi conclude the Fujairah attack crossed a red line and respond against IRGC missile, drone, or radar assets. Markets price a higher probability of direct U.S.-Iran confrontation, though the base case remains limited strikes rather than declared war.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Market volatility Up
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +2.1%
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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