Possible scenario
Houthi Retaliation Widens
30% Chance
The Houthis respond to the campaign with drone and missile attacks against Saudi targets and renewed threats to Red Sea shipping. This is the main tail risk for markets because it links Yemen's battlefield to Gulf energy infrastructure and maritime insurance costs.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- Oil prices Up
- 10-year Treasury yield Down
- US dollar Up
Secondary impacts
- Energy +1.3%
- Industrials
Portfolio impact
S&P 500-0.7%
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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